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A recession is a period of economic slowdown with declining GDP, increased unemployment, and reduced spending. It can lead to economic depression if severe or prolonged.
In economics, a recession is a business cycle contraction marked by a general slowdown in economic activity. During a recession, macroeconomic indicators such as GDP, employment, investment spending, and inflation decline, while bankruptcies and unemployment rates increase.
One of the visible signs of a recession is higher unemployment rates and closed-down businesses, leading to decreased production of goods and services. In a recession, individuals tend to spend less due to lower income, and firms are less likely to invest in new projects, affecting job availability.
A recession can transition into an economic depression if it is severe or prolonged, characterized by significant drops in GDP and extended periods of economic downturn.
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