Iift 2009 Question 62
This is a detailed step-by-step solution for Iift 2009 Question 62. Understand the concept, common mistakes, and expert tips to solve similar questions in IIFT exam.
IIFT 2009
In the 1st paragraph it is mentioned that "the phenomenon of the ‘crisis’ the fact that the substitution of a downward for an upward tendency often takes place suddenly", from this option III can be concluded.
In the 2nd paragraph it is mentioned that "explanation of the crisis is, not primarily a rise in the rate of interest, but a sudden collapse in the marginal efficiency of capital. The later stages of the boom are characterized by optimistic expectations as to the future yield of capital goods sufficiently strong to offset their growing abundance and their rising costs of production and, probably, a rise in the rate of interest also.
From this option I and II can be concluded.
Thus, option B is the correct answer.