Quiz on Lesson ” Cycles “

What is the key driver of economic growth in the long run?

A) Cycles in transactions

B) Productivity growth

C) Credit

Why does borrowing create a cycle of debt?

A) Because credit is bad and leads to overconsumption

B) Because borrowing creates an asset and a liability that must be paid back

C) Because credit is unpredictable and can cause economic swings

What is the difference between money and credit?

A) Money is an asset and credit is a liability

B) Money settles transactions immediately, while credit creates an asset and a liability

C) Money creates cycles of debt, while credit efficiently allocates resources

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