Microeconomics vs

Questions and Answers

What caused the Great Recession of 2008–09 and accompanying market crash?

Global decline in consumer spending

Increased government regulations on financial institutions

Bursting of the U.S. housing bubble and subsequent near-collapse of financial institutions heavily invested in U.S. subprime mortgages (correct)

Rise in interest rates by central banks

What effect did the response of central banks and governments to the pandemic-induced crash of spring 2020 have on major equity markets?

Led to a prolonged bear market

Caused a significant decrease in stock prices

Resulted in increased market volatility

Pushed most major equity markets to record highs in the second half of 2020 and throughout much of 2021 (correct)

What is an example of the influence of macroeconomic factors on investment portfolios mentioned in the text?

Rise in individual stock prices

Growth of the real estate market

Increase in gold prices

The Great Recession of 2008–09 and accompanying market crash (correct)

What caused the market crash accompanying the Great Recession of 2008–09?

<p>Bursting of the U.S. housing bubble and subsequent near-collapse of financial institutions heavily invested in U.S. subprime mortgages</p> Signup and view all the answers

What was the impact of macroeconomic factors on investment portfolios during the pandemic-induced crash of spring 2020?

<p>Governments and central banks unleashed torrents of liquidity through fiscal and monetary stimulus, pushing most major equity markets to record highs</p> Signup and view all the answers