Which of the Following Is the Best Definition of a Recession

question 74

Multiple Choice

Which of the following is the best definition of a recession?

• A) period that follows two consecutive quarters of declines in the level of real GDP
• B) significant, widespread decline in real income and employment
• C) period that follows a stock market crash
• D) period that has a persistent low employment rate

---

Definitions:

Market Power

The ability of a company or entity to influence or control prices and total market output in an industry.

Four-Firm Concentration Ratio

A metric that measures the total market share of the four largest firms within an industry, used to assess the degree of competition and market concentration.

Herfindahl Index

An index determining the level of market concentration by aggregating the squared market shares of all companies in the sector.

Market Share

The fraction of a market occupied by an individual company or product, often described by its percentage of aggregate sales in the market.