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Chapter 5 questions

For Chapter 5 Unit questions Click Price-output determination under different market forms
QUESTION
Q11) During recession, the unemployment rate _____ and output _____.

Correct

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Solution:
(a) Rises; falls

During a recession, economic activity slows down, and businesses may lay off workers to reduce costs.
This leads to an increase in the unemployment rate as more people are looking for jobs but are unable to find them.
On the other hand, output, which is the total value of goods and services produced in an economy, typically falls during a recession due to decreased demand for goods and services.
Correct option is (a)