ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -There is a commensurate rise in unemployment. The growth in the economy continues to decline, and as this falls below the steady growth line, the stage is called a depression.

Detailed explanation-2: -Cyclical unemployment is the unemployment associated with the ups and downs of the business cycle. During recessions, cyclical unemployment increases and drives up the unemployment rate.

Detailed explanation-3: -In a recession, the unemployment rate-the percentage of the total labor force that is unemployed but actively seeking work-tends to increase as companies cut back on staff to reduce their expenses.

Detailed explanation-4: -Recessions often start at the peak of the business cycle-when an expansion ends-and end at the trough of the business cycle, when the next expansion begins.