In: Economics
As per the data about the gorwth rates, inflation rates and unemployment rates, it is observed that the level of economic activity was highest in the Unites States in the month of February, 2020. This is the time when the country was not hit by the Covid -19. After the outbreak of the pandemic, the country has faced a situation of health crisis. In this situation, the deadly virus spreads from communication and hence has led to a stopage in the economic activity. The economy has gone under a recession due to such a fall in the economic activity. Production levels have fallen because the production units have been shut down because of the fear of virus spraeding, This has caused in an increased rate of unemployment for the people who were employed earlier along with the people who entered the labor force during the pandemic. Excess demand has been onserved in the economy because of falling supply levels and that has lead to rising inflation rate. So, mainly the prime reason behind the economy going in recession is the shift in productiuon curve downwards.