Question

Score: 0 of 1 pt 12 of 12 (11 complete) HW Score: 91.67%, 11 of 12 pts End of Chapter 2.9 Question Help * Related to the Making the Connection] Assume that you overheard a student make the following statement in your macroeconomics class: "The so-called European debt crisis may be important to people who live in Greece or Italy but it has little impact on the economy of the United States. Our economy does not depend on foreign trade as much as the economies of these countries do. And if we can't sell our exports in Europe we can always sell them in Canada, South America, or Asia." Which of the following arguments would you make to explain how the debt crises in Europe can affect the U.S. economy? (Check all that apply.) A. Consumer spending could fall sharply since U.S. households depend significantly on income transfers from Europe. B. The supply chains of many U.S. producers who rely on European companies for components could be threatened. C. As holders of significant euro area debt, U.S. banks could be exposed to significant risk by the crisis. D. While exports may be a small share of U.S. GDP, they can still be a meaningful driver of economic growth. E. Confidence among business leaders in the United States might be shaken by the crisis

Answer 1

B. The supply chains of many US producers who rely on European countries for components could be threatened.

C. At holders of significant euro area dead us banks could be exposed to significant risk by the crisis.

E. Confidence among business leaders in the United States might be shaken by the crisis