What is the definition of a depression?
A) a mild reduction in total production coupled with a rising unemployment rate that lasts for several years
B) a decline in total production that lasts less than 6 months
C) a severe fall in stock prices that causes financial panic and lasts several years
D) a severe reduction in total production coupled with high unemployment that lasts several years

Question

What is the definition of a depression?  
A) a mild reduction in total production coupled with a rising unemployment rate that lasts for several years 
B) a decline in total production that lasts less than 6 months 
C) a severe fall in stock prices that causes financial panic and lasts several years 
D) a severe reduction in total production coupled with high unemployment that lasts several years

Quizplus · Accepted Answer

A depression is defined by a severe reduction in total production (GDP) coupled with high unemployment that lasts for several years. A mild reduction in production (option A) is more commonly referred to as a recession, and a decline in production that lasts less than 6 months (option B) is typically referred to as a dip or contraction. Option C describes a financial crisis, but not specifically a depression.

What Is the Definition of a Depression