7
lesson pretestMultiple Choice

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Question 7 • CMS 2026-2027 Economics and Personal Finance CREDIT RECOVERY

Which best describes how a recession develops as demand and production decrease?

Answer
A
The recession accelerates.
B
The recession enters a recovery period.
C
The recession slows.
D
The recession starts and stops.

Explanation

As demand falls, businesses sell less and reduce production. Lower production can lead to fewer jobs and less income, which further reduces demand and production. This reinforcing decline means the recession accelerates, rather than slows or enters recovery.

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