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According to the Added Worker Effect, What Happens During a Recession

Question 26

Multiple Choice

According to the added worker effect, what happens during a recession?


A) Households consume less.
B) More inferior goods are purchased.
C) Capital earns a lower rate of return.
D) There is an increase in the labor force participation rate of secondary workers.
E) There is a decrease in the labor force participation rate as many unemployed workers give up looking for a job.

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