BUSINESS ADMINISTRATION
BUSINESS POLICY
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
higher unemployment
|
|
|
lower inflation (deflation)
|
|
|
both a & b
|
Detailed explanation-1: -When an economy enters into contraction, real gross domestic product (GDP) growth slows and unemployment rises. A contraction often leads to economic hardship for many people.
Detailed explanation-2: -A recession, sometimes called a contraction, is a period of economic slowdown and is often marked by high rates of unemployment, plunging stock prices, lower corporate profitability, and consumer anxiety.
Detailed explanation-3: -This phase ends with a peak in economic activity. In a contraction, households demand fewer goods and services, businesses reduce the number of workers they employ and growth in wages and prices slows. This phase ends with a trough in economic activity.
Detailed explanation-4: -A recession is the period between a peak of economic activity and its subsequent trough, or lowest point. Between trough and peak, the economy is in an expansion. Expansion is the normal state of the economy; most recessions are brief.