Microfinance and Agricultural Extension Assessment
Module 3 • 10 Questions
Question 1 of 10
0 of 10 answered
Muhammad Yunus observed that 42 basket weavers in Bangladesh collectively owed money lenders a total of only 27 US dollars, yet remained trapped in generational debt. What does this observation illustrate about pre-Grameen credit markets?
A
That the weavers' businesses were fundamentally unprofitable and should have closed.
B
That informal lenders charged fair rates but the weavers mismanaged their funds.
C
That formal banks were already serving the poor adequately through small loans.
D
That a trivially small amount of affordable capital could break the debt trap, but formal banks refused to lend because the poor lacked collateral and credit histories, leaving them to usurious money lenders.