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Why did the decline in stock prices fail

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Question: In October 1987, the US stock market crashed, with the Dow Jones Industrial Average falling 508 points, or 22%, in a single day. Yet the economy continued to prosper, with real GDP rising faster in the four quarters following the stock market crash than the previous four quarters. Why did the decline in stock prices fail to slow the pace of economic activity?

Reference no: EM131737332

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