Types of models include real but simplified economies, computer programs that simulate the workings of a large economy, and graphs or equations that illustrate relationships between variables.
Question
Describe who gets hurt in a recession and how they are hurt.
Recessions inflict a great deal of pain across the entire society. They cause large numbers of workers to lose their jobs and make it difficult for workers to find new jobs. Recessions reduce the standard of living of many families and are usually associated with a rise in the number of people living below the poverty line, an increase in the number of people who may lose their houses because they can no longer afford their mortgage payments, and a fall in the percentage of Americans with health insurance. Recessions also reduce the profits of firms.