4
practice testMultiple Choice

Practice Test

Question 4 • Career Planning and Development

What is the definition of a recession?

Answer
A
two consecutive quarters of declining economic output
B
a permanent decline in a nation's ability to produce goods and services
C
the lowest point of economic activity in the business cycle
D
a single month in which unemployment rises above ten percent

Explanation

A recession is commonly defined as a period of economic decline lasting at least two consecutive quarters, often measured by falling real GDP (economic output). A permanent decline in productive capacity is a different concept, and the lowest point in a business cycle is called a trough. A single month of high unemployment does not, by itself, define a recession.

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