ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A slump refers to a period of poor performance or inactivity in an economy, market, or industry. The term slump is a metaphor borrowed from geology, and is an inexact and subjective term. Within an economy, slumps can be precursors to an oncoming recession.

Detailed explanation-2: -A boom is characterized by a period of rapid economic growth whereas a period of relatively stagnated economic growth is a recession. These are measured in terms of the growth of the real GDP, which is inflation-adjusted.

Detailed explanation-3: -Economic recessions can be caused by many different elements, including loss of consumer confidence, high interest rates, a stock market crash, and asset bubbles bursting. Most events that will cause the economy to slow down can also lead to a recession if left unchecked.

Detailed explanation-4: -A recession begins just after the economy reaches a peak of activity and ends as the economy reaches its trough. Between trough and peak, the economy is in an expansion. Expansion is the normal state of the economy; most recessions are brief and they have been rare in recent decades.