Generally, when there is a financial crisis, it:
A)becomes a vicious downward cycle.
B)is made worse if it causes a recession.
C)precipitates a decline in asset prices.
D)All of the Answer s are correct.

Question

Quizplus · Accepted Answer

All of the listed options are correct. A financial crisis can lead to a vicious cycle where declining asset prices cause financial distress for individuals and institutions, which leads to further declines in asset prices. It can also trigger a recession, which exacerbates the crisis. Additionally, the crisis can lead to a significant decline in asset prices.

Generally, When There Is a Financial Crisis, It