In the Mid 1980s, Two Developments of Note Occurred

Multiple Choice

In the mid 1980s, two developments of note occurred. The first was the need for the Fed, which it publicly acknowledged, to become concerned with the level and stability of the U.S. dollar's foreign currency exchange rate. What was the second development?

A) It was the shocking fall in equity prices around the world in October 1987.
B) It was the shocking increase in equity prices around the world after the fall in prices in October 1987.
C) It was the realization that nothing could be done to curb the instability in the financial markets.
D) It was the realization that nothing could be done to provide necessary liquidity.