The sequence of events in a recession can be categorized as:
A) decreased spending $\rightarrow$0lower output $\rightarrow$ lower employment $\rightarrow$lower income.
B) decreased spending $\rightarrow$ lower income$\rightarrow$ lower employment $\rightarrow$ lower output.
C) decreased spending $\rightarrow$ lower employment $\rightarrow$ lower income $\rightarrow$lower output.
D) decreased spending $\rightarrow$ lower income $\rightarrow$ lower output $\rightarrow$ lower employment.

Question

Quizplus · Accepted Answer

The correct sequence starts with decreased spending, which leads to lower output as businesses produce less due to reduced demand. This results in lower employment because businesses need fewer workers, which then leads to lower income as people have less money to spend, perpetuating the cycle.

The Sequence of Events in a Recession Can Be Categorized →\rightarrow→

The Sequence of Events in a Recession Can Be Categorized $\rightarrow$