A recession is a period of time that lasts more than a few months where the economy gets significantly worse; a depression is defined as a severe recession where things plummet dramatically. A recession does not always lead to a depression, but a depression is always the result of a recession.Know More
There is no standard definition for either a recession or a depression, but there are some commonly accepted facts on both economic perils. A recession is defined as a period of at least a few months where the real GDP is slowly declining. There may be a period within those months that the GDP rose briefly, but plummeted again. A recession can also be seen in the way that companies do business, in employment rates and in industrial production.
When a recession turns into something more severe, it is considered a depression. A depression usually starts with a gradual recession and truly begins when the GDP and economy takes a fast drop in the way it is operating. The most famous of these depressions in history was the United States in the 1930s. The economy was booming, but gradually began to fail. It took a steep drop very quickly when the stock market crashed.Learn more in Economics
A diversified economy is an economy that has a number of different revenue streams and provides nations with the ability for sustainable growth because there is not a reliance on one particular type of revenue. This diversification provides nations with the security and reliability that they need so that if one economic revenue stream should fail, the nation knows that they have several other options for revenue.Full Answer >
In a traditional economy, products and goods are created as a result of traditions, customs and beliefs. Countries with a traditional economy use the barter system or trading as a primary form of currency. This type of economic system is generally found in rural areas or farm-based areas.Full Answer >
An agrarian economy is a type of economy that relies primarily on agricultural industry including livestock farming or crop production. It is a form of economy whose major factor of production is the agricultural land. Prosperity of agrarian economy is also influenced by other factors such adequate rainfall, suitable climate and inputs like fertilizers.Full Answer >
A closed economy refers to an economic system which does not have business relations with any economies outside its own system. Closed economies employ barriers to the trade of goods and services, monies and intellectual property to and from their economic system.Full Answer >