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Recessions usually cause _____

a. Inflation

b. Hyperinflation

c. Lower money supply

d. Unemployment

1 Answer

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Final answer:

Recessions usually lead to higher unemployment as demand falls and businesses reduce production, which contrasts with economic booms where inflation may increase with lower unemployment.

Step-by-step explanation:

Recessions usually cause higher levels of unemployment. This is because during a recession, the total demand for goods and services typically falls, leading businesses to reduce production and lay off workers. As a result, the unemployment rate increases. History shows that during times of recession, such as the Great Depression and the Great Recession of 2008-2009, the inflation rate is often lower. In contrast, when the economy grows rapidly, the rate of inflation may increase alongside a reduction in unemployment.

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