What term refers to a period when economic growth falls for two or more consecutive quarters?

• A. Interest rate
• B. Recession
• C. Unemployment
• D. Seasonal unemployment

Answer: (B)

When real GDP falls for two consecutive quarters, the economy is in a recession. This pattern shows a sustained downturn in overall economic activity across production and incomes for back-to-back quarters, which often leads to reduced spending, investment, and hiring. The two-quarter rule is a handy shorthand for identifying a downturn, though official recessions can be determined using a broader mix of indicators. The other terms describe different ideas: the interest rate is the cost of borrowing money, unemployment is the level of people without jobs, and seasonal unemployment is temporary job loss tied to predictable seasonal patterns.