In the business cycle, when is "deflation" most likely to occur?
a. as gdp rises
b. during a recession
c. during expansion
d. with low unemployment

The correct answer is B. During a recession

Unlike deflation when money loses value, in deflation, money gains a lot of value. this means that there's not that much of it and it is worth a lot, which is why the prices go down because money becomes rare. This is different from inflation because in inflation money loses value since it's found everywhere and it's not worth anything.

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