Great Recession Research Paper

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An economic recession occurs when the economy is suffering, and unemployment is on a rise. A drop in the stock market and a decrease in the housing market will also affect the economy due to a recession. Higher interest rates affect the economy constrain liquidly or the cash available to invest in stocks and businesses. Inflation alludes to the rise in prices of goods and services which also puts a strain on the economy further adding to a recession. Businesses were lost and consumer spending dwindled the only category that remained safe was healthcare. The economic meaning of a recession is a decline in the Gross Domestic Product (GDP) consisting of two consecutive quarters on a decline. If the economy is bad consumers are less likely to spend money on goods and service. The effects of a declining economy forced the government to create monetary …show more content…

The demand side policies did not prevail in completely taking out the serious impacts of the economic downfall. During the great depression, unemployment rates skyrocketed, and businesses crumbled. Consumer spending decreased. During the great depression, fiscal and monetary policies were implemented by the Federal Reserve System in response to the economic decline. With the implementation of these policies stimulus packages were also put into place in February of 2008. The Economic Stimulus Act of 2008 contributed to over billions of dollars towards tax rebates to families in the United States. Tax rebate checks were sent out to families both lower and middle-class Americans. The effects of the stimulus package were significantly increasing the GDP and lowering the unemployment and adding jobs. Another success because of the polices was the real estate equity on housing which went up significantly (Reed, n.d.). Without these fiscal policies, the economy would continue to decline and unemployment would be on a

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