As the housing bubble began to burst in 2006-2008, investors would only buy mortgage-backed securities at high yields to compensate for higher perceived default risk. As a result::

A) banks suffered significant capital losses as the value of their holdings of mortgage-backed securities declined
B) funds available for mortgages increased
C) bank profits rose as they earned higher interest on mortgages
D) the price of mortgage-backed securities tended to rise due to the higher yields