Respuesta :
When the business cycle has hit its peak and is about to enter a period of sustained economic contraction and the possibility of a severe recession, to maximize gains the prescient investor should not borrow money to buy real assets. Thus, option A is correct.
What is a recession?
In the case of recession, the market is considered as a downward movement. That also means that the GDP is being affected and the unemployment rates as well as consumer spending that slow.
As in the business cycle, the person has been trying an attaining a business acquisition or property then the person should not borrow money to buy it as the company is going to enter a market that is going into recession and the market flow will be low, and it will create various consequences for the business. Therefore, option A is the correct option.
Learn more about recession, here:
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The question is incomplete, the complete question will be:
Borrow money to buy real assets. Buy nominal assets such as bonds.
O Lend money.
O Hold cash.
