In an advanced economy,a financial crisis can begin in several ways,including
A) mismanagement of financial liberalization or innovation.
B) asset pricing booms and busts.
C) an increase in uncertainty caused by failure of financial institutions.
D) all of the above.

Question

Quizplus · Accepted Answer

A financial crisis can begin due to mismanagement of financial liberalization or innovation, asset pricing booms and busts, or an increase in uncertainty caused by the failure of financial institutions. Any one of these factors alone or in combination can trigger a financial crisis in an advanced economy. Therefore, the best answer is D, all of the above.

In an Advanced Economy,a Financial Crisis Can Begin in Several