Economics

Does Unemployment Cause Recession?

Let’s start with a basic understanding of what an economic recession is. “A considerable fall in activity extended across the economy, lasting more than a few months, observable in industrial production, employment, real income, and wholesale-retail trade,” according to the National Bureau of Economic Research, a non-profit, non-partisan research organization. Businesses lose money as all

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How To Stop A Recession?

Expansionary fiscal policy boosts aggregate demand by increasing government expenditure or lowering tax rates. Expansionary policy can achieve this by: (1) increasing consumption by increasing disposable income through personal income tax or payroll tax cuts; (2) increasing investment spending by increasing after-tax profits through business tax cuts; and (3) increasing government purchases by increasing federal

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