Multiple Choice
Which of the following is a consequence of an increase in long-run aggregate supply?
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1. Introduction to Macroeconomics
Introduction to Economics
Multiple Choice
Compared to other recessions since World War II, which of the following characteristics best describes the Great Recession of 2007–2009?
A
It resulted in the lowest unemployment rate among postwar recessions.
B
It was quickly followed by a rapid economic recovery.
C
It was the longest and deepest recession in terms of GDP decline.
D
It was primarily caused by a sharp increase in oil prices.
Verified step by step guidance1
Step 1: Understand the context of the Great Recession (2007–2009) by reviewing its key economic indicators such as GDP decline, unemployment rate, and duration compared to other postwar recessions.
Step 2: Analyze the unemployment rate during the Great Recession and compare it with unemployment rates in other recessions since World War II to determine if it was the lowest or not.
Step 3: Examine the speed and nature of the economic recovery following the Great Recession, noting whether it was rapid or prolonged relative to other recessions.
Step 4: Investigate the depth and length of the recession by looking at GDP data to see if the Great Recession was the longest and deepest in terms of GDP decline compared to previous recessions.
Step 5: Consider the causes of the Great Recession, particularly whether it was primarily triggered by a sharp increase in oil prices or other factors such as the financial crisis related to housing and credit markets.
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