Which expenditure item is responsible for the decrease in real GDP during a recession?
A) mostly investment spending
B) mostly consumption spending
C) mostly government spending
D) mostly exports

Question

Quizplus · Accepted Answer

Investment spending typically decreases during a recession because businesses cut back on spending due to lower consumer demand and uncertainty about the future. This reduction in investment spending directly impacts real GDP.

Which Expenditure Item Is Responsible for the Decrease in Real