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A depression is a recession (decline in GDP / real output for 2 or more quarters) that lasts longer and has a larger decline in business activity. On the other hand inflation is a general rise in prices across the economy.
Thus a depression is characterized by a negative average real output growth rate while during inflation there is a rise in price levels in the economy.
Fiscal and monetary policy in ...
The difference between economic depression and inflation and appropriate fiscal and monetary policy in each of these situations are discussed.
Explain Inflation, Stagflation, Recession, Depression and Expansion
Inflation, stagflation, recession, depression, expansion, and contraction are commonly used terms in economics and the media. What do these terms mean? In your explanation, discuss how some of these terms are related.View Full Posting Details