BUSINESS ADMINISTRATION
STRATEGIC MANAGEMENT
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
true
|
|
false
|
Detailed explanation-1: -During a recession, stock prices typically plummet. The markets can be volatile with share prices experiencing wild swings. Investors react quickly to any hint of news-either good or bad-and the flight to safety can cause some investors to pull their money out of the stock market entirely.
Detailed explanation-2: -What Happens in a Recession? Economic output, employment, and consumer spending drop in a recession. Interest rates are also likely to decline as the central bank (such as the U.S. Federal Reserve Bank) cuts rates to support the economy.
Detailed explanation-3: -While there is also no standard definition for depression, it is commonly defined as a more severe version of a recession.
Detailed explanation-4: -Economic recessions can be caused by many different elements, including loss of consumer confidence, high interest rates, a stock market crash, and asset bubbles bursting. Most events that will cause the economy to slow down can also lead to a recession if left unchecked.