A Recession Abroad Would

question 118

Multiple Choice

A recession abroad would

• A) increase U.S. net exports and increase aggregate demand.
• B) increase U.S. net exports and increase aggregate supply.
• C) reduce U.S. net exports and reduce aggregate demand.
• D) reduce U.S. net exports and increase aggregate demand.

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Definitions:

Highest Betas

Assets or securities that exhibit the greatest sensitivity to market movements, typically offering higher potential returns, but also higher risk.

Lowest Betas

In finance, refers to the stocks or portfolios with the lowest measures of volatility or market risk in comparison to the market as a whole.

Principle of Diversification

A risk management strategy that mixes a wide variety of investments within a portfolio to reduce exposure to any single asset's volatility.

Positively Correlated Stocks

Stocks whose prices tend to move in the same direction due to similar underlying factors or market conditions.