Recessions Do Not Last Forever Because

question 51

Multiple Choice

Recessions do not last forever because

• A) Workers get tired of being unemployed.
• B) Firms eventually have incentives to increase employment and produce more output.
• C) Government steps in and boosts spending back to long-run levels.
• D) Central banks have control over the money supply.

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Definitions:

Profit Margin

Profit margin is a financial metric used to assess a company's profitability by comparing net income to sales, indicating how much of each dollar in revenue a company keeps as profit.

Anticipated Amount

The anticipated amount is an estimate of funds expected to be received or paid in the future.

External Financing

Funds raised from sources outside the company, including banks, investors, or public markets.

Operating Capacity

The maximum output or the level of service that a company can achieve with its current resources under normal conditions.