It Is Often True That, as the Economy Begins to Recover

Multiple Choice

It is often true that, as the economy begins to recover from a recession, the unemployment rate rises. Which of the following statements would be the best explanation for this?

A) The unemployment rate would rise because, as the economy initially recovers from a recession, the demand for goods and services falls and so the demand for workers falls.
B) As the economy initially recovers from a recession, firms do not immediately increase the number of workers they hire. Firms wait to hire more individuals until they are convinced that the recovery is strong.
C) As the economy begins to recover from a recession, workers who were previously discouraged about their chances of finding a job begin to look for work again.
D) The unemployment rate seems to rise as the economy begins to recover from a recession because of errors in the way the data are collected.