In a recession:
A) Budgets can be relaxed as there is more capital available.
B) The number of failing organizations reduces.
C) Retrenchment strategies are frequently required as demand falls and costs need containing.
D) Strategies become obsolete.

Question

Quizplus · Accepted Answer

During a recession, there is a decrease in demand for products and services, which leads to a decrease in sales and revenue for businesses. In order to survive and remain profitable, businesses often need to implement retrenchment strategies to cut costs and streamline operations. This can involve layoffs, reducing expenses, and making other changes to improve efficiency. Therefore, budget relaxation and strategies becoming obsolete are unlikely to occur during a recession, and the number of failing organizations may actually increase due to economic challenges.

In a Recession