A Recession Is Best Defined as a Period During Which

question 108

Multiple Choice

A recession is best defined as a period during which

• A)the percentage of the population employed is declining
• B)employment,output,and income decline
• C)the price level is declining
• D)more resources are used
• E)the budget deficit and trade deficit are both growing

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Definitions:

Excess Capacity

describes a situation where a firm produces less than its total output capacity, usually resulting in inefficiencies and higher production costs.

Economic Profit

The difference between total revenue and total economic costs, including both explicit and implicit costs, reflecting the true profitability of a firm.

Elastic

A characteristic of supply or demand that indicates a high responsiveness to changes in price.

Monopolistic Competitor

A firm operating in a market structure where many companies sell products that are similar but not identical, allowing for some degree of market power and price setting.