SSC
WORLD GEOGRAPHY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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What effect did the 2008 economic downturn in the United States have on the global economy?
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Other countries prospered due to lower economic competition from the United States.
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Other countries balanced their budgets with profits from loaning money to the United States.
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Other countries also suffered financial distress.
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Other countries stopped investing in the United States’ economy.
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Explanation:
Detailed explanation-1: -As a result of the Great Recession, the United States alone lost more than 8.7 million jobs, according to the U.S. Bureau of Labor Statistics, doubling the unemployment rate. Further, U.S. households lost roughly $19 trillion in net worth as the stock market plunged, according to the U.S. Department of the Treasury.
Detailed explanation-2: -Economists cite as the main culprit the collapse of the subprime mortgage market-defaults on high-risk housing loans-which led to a credit crunch in the global banking system and a precipitous drop in bank lending.
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