Which of the Following Is Not Blamed for Causing the Recession

question 26

Multiple Choice

Which of the following is not blamed for causing the recession of 2008?

• A) the bursting of the real estate bubble.
• B) lax government regulation of the financial services industry.
• C) decreased consumer credit card use.
• D) unscrupulous lending practices and risky mortgages.
• E) frozen credit by banks.

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Definitions:

Perfectly Elastic

Describes a scenario where the quantity demanded or supplied changes infinitely in response to any change in price.

Marginal Revenue

The additional revenue generated from selling one more unit of a good or service; crucial for determining the optimal level of output for profit maximization.

Purely Competitive Market

A market structure characterized by many buyers and sellers, homogeneous products, and the ease of entering and exiting the market.

Unit Price

The cost per unit of volume or weight of a product, allowing for easier comparison of costs between different sized packages of the same item.