an extended recessionary period is indicative of

Question:- an extended recessionary period is indicative of

Answer:- A prolonged recessionary period typically points to a general economic weakness, policy mistakes, consequences of major financial crisis or global economic factors delaying recovery and even structural changes forcing for an extended transition. If a recession persist for an unreasonable extend of time, it would indicate that there are some deeper issues with the economy not being addressed properly such as high debt levels or rigidities in labor market /or over involvement on shrinking sectors. Additionally, prolonged downturns can be unnecessarily elongated by ineffective government policy responses like setting improper interest rates or failing to provide sufficient stimulus. Recessions that result from financial crises often persist longer because of widespread devastation in the bank balance sheets. Reduced trade flows synchronize recessions across countries by transmitting weakness in major trade partners globally. Finally, significant technological, demographic or geopolitical changes can be the cause of a long recession as labor capital and production take time to adapt themselves to new configurations The longer a recession, the more troubling the implications tend to be about underlying weaknesses policy errors financial contagion global factors and structural changes.