Explanations About What Caused the Great Recession Differ Sharply Among

question 112

Multiple Choice

Explanations about what caused the Great Recession differ sharply among economists.The so-called Minsky Explanation involves the following factors, except

• A)a massive euphoric bubble in housing prices that eventually burst.
• B)a huge negative demand shock in the economy.
• C)flexible average price levels in the economy.
• D)excessive access to home-mortgage loans.

---

Definitions:

Fixed Incomes

Earnings from investments that provide a set return, such as bonds or dividends from stocks.

Inflation

Economic situation characterized by rising prices caused by a combination of excess consumer demand and increases in the costs of raw materials, component parts, human resources, and other factors of production.

Consumer Price Index (CPI)

Measurement of the monthly average change in prices of goods and services.

Energy And Food Prices

The costs associated with obtaining and consuming energy resources and food commodities, which can significantly impact economic conditions and living standards.