Which best describes how a recession develops as demand and production decrease? A. The recession enters a recovery period.
B. The recession slows.
C. The recession accelerates.
D. The recession starts and stops.
Which best describes how a recession develops as demand and production decrease?
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The correct answer is C. The recession accelerates.
When demand decreases, businesses typically reduce production to avoid excess supply. This can lead to layoffs, decreased consumer spending, and a further drop in demand, creating a cycle where the recession deepens or accelerates. Thus, a recession develops and intensifies as both demand and production decline.
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