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Recession Affect The Economy

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Recession is a period of activity wherein there is a slowdown in the growth of the economy. Recession is a downward trend in the business cycle, which is different from economic prosperity, economic depression, and economic recovery, is a decline in production and employment which is experienced for a long time. The recession is also defined as the reduced demand for services, wherein there is a reduction in different types of services and really affects in the growth of the gross domestic product rate or the GDP rate. The inadequate goods and supply really affect the economy by having a scarcity and limited supplies of goods. The word “recession” refers to a period of economic activity is characterized by negative growth in the economy, which …show more content…

The big negative effect of the recession is the economic shock that led to a sharp increase of unemployment rates in several countries and many young and prime age workers and even older workers are affected by it. The evolution of GDP or Gross Domestic Product rates really affects every individual and the GDP rates are very unprecedented and had a negative effect in many countries over the past decades. The labor market is a place where workers and employees interact with each other and the labor market institution also affects the functioning of the labor markets in terms of the unemployment and demand and supply of labour in different countries. There is a great need for economic growth by having the “one size fits all” character, which refers to the improvement of employment rates and improvement of labor markets and GDP (Van Ours, …show more content…

Companies should have greater marketing strategies in order to improve their business sales and to have preliminary implications on how to facilitate the marketing and business in times of recessions (Notta and Vlachvei, 2015). A financial innovation is very adequate and sufficient to create new financial instruments, technologies, institutions and markets to have a new perspective and ideas to prevent and lessen the possibility of economic recessions. Securitization helps the recession in terms of mortgages by transforming them in security. And the emergence of the banking system is very important to provide a well planned system in terms of banking matters in times of recessions (Joseph, Larrain and Turner,

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