Question

From a macroeconomic perspective, if GDP economic indicators show a decline of 10% or more in a single year, then which of the following outcomes is most likely to result?

a. deep economic depression
b. influx of foreign capital
c. lessening of foreign aid
d. merchandise trade surplus

Answer 1

a. Deep economic recession

Step-by-step explanation:

According to macroeconomist when there is a decline (negative growth) in GDP of an economy for a period of about two years it often result in a deep recession.

Macroeconomics looks at things from the larger scale or broader sectors of an economy.

Therefore, Companies would reduce their production inorder to reduce the risks of losses resulting from declining gross domestic product. Which then leads to decrease in prices.