Question

There are five stages in a recession.



1. job loss

2. falling production

3. falling demand (occurs twice)

4. peak production



In which order do these stages occur?

4, 3, 2, 1, 3
3, 2, 1, 3, 4
4, 3, 2, 3, 1
4, 2, 3, 1, 3

Answer 1

4, 2, 3, 1, 3

Explanation: peak production comes first (4), then production falls (2). That reduces demand (3), which causes job losses (1); job losses then cause demand to fall again (3).