The 2008 global financial crisis began with the US subprime lending crisis in 2007, which led to the banking crisis and the collapse of Lehman Brothers in 2008. Subprime lending gives loans to borrowers who may struggle to repay; it arose from excess liquidity following the East Asian crisis. Which precedence sequence follows?
East Asian crisis → subprime lending crisis → banking crisis → global financial crisis
Subprime lending crisis → global financial crisis → banking crisis → East Asian crisis
Banking crisis → subprime lending crisis → global financial crisis → East Asian crisis
Global financial crisis → East Asian crisis → banking crisis → subprime lending crisis
Correct answer: (A) East Asian crisis → subprime lending crisis → banking crisis → global financial crisis
Explanation
Follow the causal order explicitly supplied: the East Asian crisis precedes excess liquidity and subprime lending; the subprime crisis precedes the banking crisis, which develops into the global financial crisis. Therefore A. This is an ordering of the passage’s claims.
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