The U.S. Great Recession of 2007 to 2009 was caused by:
A) a contractionary supply shock.
B) an expansionary supply shock.
C) a contractionary demand shock.
D) an expansionary demand shock.

Question

Quizplus · Accepted Answer

The U.S. Great Recession of 2007 to 2009 was primarily caused by a contractionary demand shock, which occurred due to the bursting of the housing bubble, leading to a significant decline in consumer wealth and spending, and a crisis in financial markets that reduced lending and investment.

The US Great Recession of 2007 to 2009 Was Caused By