Deflation indicates declining price levels

Steps:

• Recall that deflation is defined as a sustained decrease in the general price level of goods and services.
• Analyze the question: "Second month of deflation" specifies ongoing price falls, not other economic indicators.
• Evaluate choices: Match the definition directly to falling prices, eliminating unrelated concepts like recession or demand.
• Confirm: No additional data needed; the term alone points to price levels.

Why B is correct:

• Deflation is the economic term for a persistent fall in the overall price level, as measured by indices like the CPI.

Why the others are wrong:

• A: Recession involves GDP contraction, not directly tied to deflation.
• C: Rising demand typically causes inflation, not deflation.
• D: Unemployment trends are separate from price movements.

Final answer: B