The Reagan administration in the 1980s contributed to the economic crisis that began in 2007 by ________.
A) initiating subprime mortgages
B) decreasing the net capital rule
C) removing many regulations for banks
D) encouraging China to underwrite U.S. debt

Question

Quizplus · Accepted Answer

The Reagan administration, as part of its deregulation efforts, removed many regulations for banks, including the Glass-Steagall Act, which had separated commercial and investment banking. This led to an increase in risky lending and investments by banks, contributing to the economic crisis that began in 2007. The other choices listed were not directly initiated by the Reagan administration.

The Reagan Administration in the 1980s Contributed to the Economic