What term refers to a period when economic growth falls for two or more consecutive quarters?

What term refers to a period when economic growth falls for two or more consecutive quarters?

• A. Interest rate
• B. Recession
• C. Unemployment
• D. Seasonal unemployment

Answer: (B)

When real GDP falls for two consecutive quarters, the economy is in a recession. This pattern shows a sustained downturn in overall economic activity across production and incomes for back-to-back quarters, which often leads to reduced spending, investment, and hiring. The two-quarter rule is a handy shorthand for identifying a downturn, though official recessions can be determined using a broader mix of indicators. The other terms describe different ideas: the interest rate is the cost of borrowing money, unemployment is the level of people without jobs, and seasonal unemployment is temporary job loss tied to predictable seasonal patterns.

When real GDP falls for two consecutive quarters, the economy is in a recession. This pattern shows a sustained downturn in overall economic activity across production and incomes for back-to-back quarters, which often leads to reduced spending, investment, and hiring. The two-quarter rule is a handy shorthand for identifying a downturn, though official recessions can be determined using a broader mix of indicators. The other terms describe different ideas: the interest rate is the cost of borrowing money, unemployment is the level of people without jobs, and seasonal unemployment is temporary job loss tied to predictable seasonal patterns.