Why Did Many Economists Suspect a Credit Crunch Occurred in the Fall

question 86

Multiple Choice

Why did many economists suspect a credit crunch occurred in the fall of 1998?

• A)Interest rates rose sharply.
• B)The U.S. economy entered a recession.
• C)Banks curtailed lending to risky borrowers.
• D)Investment spending declined dramatically.

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Definitions:

Job Order Costing

An accounting method used to track costs and evaluate the expenses associated with specific jobs or batches.

Process Costing

Process Costing is an accounting methodology used to allocate costs to units of product in processes where the products are indistinguishable from each other, such as in manufacturing of chemicals or food.

Job Cost Sheet

A document that records and tracks the costs associated with a specific job or project.

Direct Labor Costs

The wages and other benefits paid to workers who are directly involved in the production of goods or services.