Question

The term  contagion refers to

		the vulnerability of healthy economies to crises generated by events elsewhere.
		a directed attack on one market by a foreign market.
		a government's complete control over it's banking system.
		a side effect of international trade.
		a drop in interest rates across industrialized countries.

Answer 1

In economics, term “contagion” is used for describing a situation where a shock in an economy or region proliferate and affects others economy through price movements. Description: In other words, the contagion effect describe the possibility of spread of economic crisis or boom across countries.

Hence it can be said that the term contagion refers to the vulnerability of healthy economies to crisis generated by events elsewhere.

Hence option first is the correct answer.