Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Gross Domestic Product (GDP)
B
Consumer Confidence Index
C
Stock Market Prices
D
Inflation Rate
Understanding the Answer
Let's break down why this is correct
Answer
During a recession, one of the economic indicators that usually declines significantly is unemployment. This happens because businesses often make less money during a recession and may need to cut costs, which often leads to layoffs or hiring freezes. For example, if a company sells fewer products, it might have to let go some of its workers to save money, increasing the unemployment rate. As more people lose their jobs, they have less money to spend, which can further hurt the economy. Therefore, during a recession, rising unemployment is a clear sign that the economy is struggling.
Detailed Explanation
During a recession, people buy less and businesses make less money. Other options are incorrect because Some might think that consumer confidence always drops during a recession; Many believe stock prices always fall during a recession.
Key Concepts
recession
economic indicators
Topic
Explaining Economic Changes
Difficulty
medium level question
Cognitive Level
understand
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