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A collapse in Buldovia's banking system eventually led to companies unable to borrow money to run their businesses. Firms terminated employees. These circumstances cut into consumer's purchasing power, causing a severe decline in the prices of goods and services, better known as _______.

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sandlee09

Answer:

Deflation

Explanation:

According to my research on economic downturns, I can say that based on the information provided within the question what is being described is better known as Deflation. In economics this is when the general price level of goods and services falls under the normal levels, which in term increases the value of the currency over time.

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