In October, 2008, most of the major stock indices around the world plummeted in value. The most likely cause for these dramatic events were ________?

Question

Quizplus · Accepted Answer

The sudden drop in major stock indices around the world is more likely to be caused by systematic risk factors, such as a global economic recession or a geopolitical crisis, than non-systematic risk factors, such as company-specific events or random fluctuations. Variable betas may affect the price volatility of individual stocks or portfolios, but they are not the primary driver of the broad market movements seen during the October 2008 crisis. Therefore, option C is the most reasonable answer.

In October, 2008, Most of the Major Stock Indices Around