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Consecutive periods of deflation are also known as _____.

A.economic fluctuations B.depressions C.economic growth D.recessions

2 Answers

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Answer: D

Step-by-step explanation:

User Caleb Doucet
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The correct answer is D.

Deflation is a decrease in the general price level of goods and services. It occurs when the inflation level falls below 0%. Deflation is seen as a problem in economics because it increases the real value of debt which in turn aggravates and provokes recession.

Recession is a general slow down in economic activity. Its main reasons are prolonged periods of deflation, a financial crisis or an adverse supply shock. Inflation falls during recession which is usually preceded by long and consecutive periods of deflation.

User Lazy Functor
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