Which among the following economic recoveries, the recession period is longest?

[A] W Shaped Recovery

[B] K shaped recovery

[C] L shaped recovery

[D] U shaped recovery

Answer: C

Notes:

Types of Economic Recoveries:

V shaped:The economy experiences a sharp decline but then bounces back almost immediately to its pre-recession level.
U shaped: The economy declines and then spends a significant period of time at the trough before improving.
W shaped:This is also known as a double-dip recession. There is a brief economic comeback but then the economy falls a second time.
L shaped:L-shaped recovery has the lengthiest recession period of all. The long period of recession is dubbed as depression. After a sharp decline, GDP begins to increase, but recovery is very gradual and lengthy. It can take years for the economy to get back to where it was pre-downturn.
K shaped:One segments of the economy recovers rather quickly (more like V or U-shaped recovery) while the other segment recovers much slowly (like L shaped). The divergence between the two segments is similar to two lines of the letter K. Many economists predict that economic recovery post COVID pandemic will Be K shaped.

Source: EPIC September 2021