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24 December, 09:48

Why did the subprime mortgage crisis in the United States cause other countries to also enter economic downturns?

A. Mortgage lenders were foreclosing on homes in other countries.

B. The global economy is intertwined with the U. S. economy.

C. Other countries had invested heavily in subprime loans.

D. The U. S. economy supports the entire global economy.

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  1. 24 December, 11:53
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    The right answer is:

    B. The global economy is intertwined with the U. S. economy.

    Explanation:

    The U. S. financial markets have extensive links to other countries's financial systems. So, the crisis and the subsequent deterioration of the environment of the American financial system had a severe impact on business and economies all around the world. US banks are investors abroad. There were also loss of GDP, losses of jobs and rising unemployment, more difficulties in getting access to funding, and decreasing US demand for many countries that have the US as a top export destination. Those are some effects of the US subprime mortgage crisis.
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