When a recession gets under way
A) firms start to lay off workers to reduce costs.
B) consumer confidence rises because people expect an eventual recovery.
C) inflation always rises because the government prints more money.
D) inflation falls because the government reduces its budget deficit.

Question

Quizplus · Accepted Answer

During a recession, firms may struggle to make profits and may therefore seek to reduce costs. One way of doing this is to lay off workers, which can result in higher unemployment rates.

When a Recession Gets Under Way