The Recession of 2007-2009 Happened in Part Because, After the Housing

question 116

Multiple Choice

The recession of 2007-2009 happened in part because, after the housing bubble burst in 2006, disruptions in the financial market made it difficult:

• A)for government to finance deficit spending.
• B)to fight inflation.
• C)for businesses and consumers to borrow money.
• D)to shift the PAE line downwarD.After the housing bubble burst, many loans went bad and banks and other lenders reduced availability of loans.

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