Which of the Following Is a Similarity Between the Japanese

question 65

Multiple Choice

Which of the following is a similarity between the Japanese experience of the 1990s and the U.S.economic downturn in 2008-2009?

• A)Stable real estate and stock market prices eventually led to an economic downturn.
• B)Both Japan and the U.S.tightened lending standards and this eventually led to a substantial decline in real estate prices.
• C)The collapse of stock and real estate prices led to the failure of highly leveraged banking and financial institutions.
• D)Neither Japan nor the U.S.had experienced a recession since the time of the Great Depression.

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Definitions:

Short Run

An interval in economic studies where a minimum of one production element remains constant and is unalterable.

Variable Costs

Expenses that change in proportion to the activity of a business.

Short Run

A time period in economics during which at least one input, such as plant size, is fixed and cannot be altered.

Profit Maximization

The procedure through which a business identifies the pricing and production volume that yields the highest earnings.