A bubble is a situation in which there is a rapid escalation of <span>asset prices which is later followed by a contraction of the same. When there is a surge in asset prices which is unwarranted by the fundamentals of the assets that are in question and an exuberant market behavior supports it, a bubble is created. When nobody buys anymore and starts selling everything off then the bubble is deflated.
In that period, many people started buying homes with mortgages with adjustable rates. When the stocks started rising so did the prices of mortgage interest rates and people started realizing they couldn't pay back their loans and started losing homes. When the homes were taken away, there was a realization that the houses were not worth at all the price that was owed and that banks would suffer severe losses because of the bad mortgages that they gave. This led to the 2008 recession.</span>
Answer:
im pretty sure if is? correct me if I'm wrong but that looks right but i could be wrong
Yes, the federal government responded to the great recession of 2007-09.
<u>Explanation:
</u>
The United States endured the most serious post-war depression between December 2007 and June 2009.
The economic crisis of 2007-09 was long enough to call itself the "Great Recession" and accompanied by a lengthy and exceptionally slow recovery. The financial crisis was deep and severe enough.
The subsequent recessions have been followed by two types of policy mechanisms: monetary and fiscal.
Monetary policy is used to preserve low-interest rates and reduce unemployment both during and after depression, which is the Act regarding the Federal Reserve
.
I think it’s A but it could also be D
