A serious consequence of a financial crisis is
A)a contraction in economic activity.
B)an increase in asset prices.
C)financial engineering.
D)financial globalization.

Question

Quizplus · Accepted Answer

A financial crisis often leads to a contraction in economic activity, as businesses struggle to access credit and individuals and government entities reduce their spending. This can lead to a recession or even a depression, causing significant hardship for individuals and the broader economy. The other choices are not directly relevant to the consequences of a financial crisis.

A Serious Consequence of a Financial Crisis Is