Business cycles tend to impact nations other than the nation in which they are occurring because of ________________.
A)foreign repercussions
B)absorption
C)the income elasticity of imports
D)the foreign multiplier

Question

Quizplus · Accepted Answer

Business cycles in one nation can impact other nations through various channels, including trade, investment, and financial linkages. For example, if a major economy experiences a recession, it may reduce its demand for imports from other countries, leading to decreased exports and economic slowdown in those countries. Additionally, financial contagion can occur if a crisis in one country spreads to other countries through financial markets or banking systems. These channels of transmission can result in foreign repercussions of domestic business cycles.

Business Cycles Tend to Impact Nations Other Than the Nation