During the recent financial collapse, financial managers failed to do their job effectively because of risky financial decisions and poor investment decisions.
When the value of financial assets and instruments drastically declines, a financial collapse occurs. As a result, companies struggle to pay their debts, and financial institutions are unable to fund projects or satisfy urgent needs due to a shortage of available cash or convertible assets. Investors' faith in their assets' worth declines, and consumers' incomes and possessions are jeopardized, making it challenging for them to make their loan payments.
Starting with the onset of the issue, the financial collapse can be divided into three phases. Economic systems go down for a variety of reasons, including institutional financial mismanagement, design and regulatory flaws, and more.
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