What would likely have the most severe immediate effect on an economy?
A)A significant drop in exports
B)The Fed's infusing reserves into the economy
C)An aggregate demand shock
D)A failure of the financial sector

Question

Quizplus · Accepted Answer

A failure of the financial sector would likely have the most severe immediate effect on an economy because it directly impacts all aspects of the economy, including lending, investment, and consumer confidence, potentially leading to a rapid and widespread economic downturn.

What Would Likely Have the Most Severe Immediate Effect on an Economy