International Relationship Question:
List the causes of recession?
Answer:
★ Inflation is one of the major causes of recession. Inflation leads to the rise in the prices of goods and services that results in an increase in the cost of production and then the national debt.
★ As a result of inflationary pressure people cut down their spendings, especially on luxurious things, that results in a decrease of the overall spending. People start saving more and gradually the GDP declines.
★ Due to high production cost, companies lay off workers to cut costs.
★ Thus, altogether, these factors result in an economical fall and ultimately in a recession.
★ As a result of inflationary pressure people cut down their spendings, especially on luxurious things, that results in a decrease of the overall spending. People start saving more and gradually the GDP declines.
★ Due to high production cost, companies lay off workers to cut costs.
★ Thus, altogether, these factors result in an economical fall and ultimately in a recession.
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