Final answer:
The mortgage crisis of 2008-2009, also known as the financial crisis, was caused by reckless lending practices, risky behavior by investment firms, and inadequate government oversight.
Step-by-step explanation:
The mortgage crisis of 2008-2009, also known as the financial crisis, was a significant event in the field of Economics. It was caused by a combination of reckless lending practices, risky behavior by investment firms, and inadequate government oversight. During this time, banks provided mortgages to people with poor credit histories, while investment firms purchased these risky mortgages in the form of mortgage-backed securities (MBS). When the borrowers defaulted on their mortgages, the value of the MBS plummeted, causing a ripple effect throughout the financial system.