Which of the following is one reason for the decline in aggregate demand that led to the recession of 2008-2009?
A)falling oil prices
B)increases in housing prices
C)the U.S.financial crisis
D)a decline in government spending
E)a shrinking Canadian labour force

Question

Quizplus · Accepted Answer

The U.S. financial crisis, which began with the subprime mortgage crisis and spread to other sectors of the financial system, led to a significant decrease in consumer and business confidence, causing a decline in aggregate demand. This resulted in a decrease in spending and investment, leading to the recession of 2008-2009. The other options listed either had a negligible impact or a contradictory effect on aggregate demand during that period.

Which of the Following Is One Reason for the Decline