Question

which of the following best explains what happens when consumers think the economy is struggling?

people spend more, businesses produce less, and unemployment rises.

people spend more, businesses produce a lot, and unemployment is low.

people spend less, businesses produce too much, and unemployment is low.

people spend less, businesses produce less, and unemployment rises.

Explanation:

When consumers expect a struggling economy, they reduce spending to save for potential financial hardship. Lower consumer demand leads businesses to cut production, which in turn causes businesses to lay off workers, increasing unemployment.

Answer:

People spend less, businesses produce less, and unemployment rises.