What’s the difference between a recession, a depression and a cost of living crisis?

Question

What’s the difference between a recession, a depression and a cost of living crisis?

In: 24

Answer 1

Recession = two consecutive quarters of Gross Domestic Product (GDP) reduction, which generally means an economic slowdown, less trade and a decrease in economic activity. GDP = the total of all goods and services produced by an economy.

Depression = significant/severe drop in GDP that generally lasts for a year or more, typically includes widespread job losses and a severe/prolonged drop in economic activity

COL crisis = a period of rapidly rising prices for day-to-day/essential items (housing, food, basic transportation, etc.) – COL crises can occur even when the economy is strong (i.e., not in a recession or depression)