The Business Cycle

Last updated over 7 years ago

5 questions

Note from the author:

1

The Business Cycle B184 Business Ex

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Economists recognize that the economy doesn't grow smoothly, but in regular patterns. They refer to this as:

the circular flow of economic activity

 the Business Cycle

the Classical Model

the Keynesian Cycle

 recession, trough, advance, peak

 expansion, intermediate 1, recession, intermediate 2

 expansion, peak, reversal, prosperity

 expansion, peak, recession, trough

 contracts for at least three years in a row

 contracts for one month

 contracts for at least six months

 contracts for at least two years minimum

real GDP is shrinking, prices are rising, and unemployment is low 

real GDP is growing, prices are rising, and unemployment is low.

 real GDP is growing, prices are falling, and unemployment is low.

 real GDP is shrinking, prices are falling, and unemployment is low.

3%

5%

4%

7%

Economists recognize that the economy doesn't grow smoothly, but in regular patterns. They refer to this as:

the circular flow of economic activity

 the Business Cycle

the Classical Model

the Keynesian Cycle

The business cycle has two phases and two turning points, as follows

 recession, trough, advance, peak

 expansion, intermediate 1, recession, intermediate 2

 expansion, peak, reversal, prosperity

 expansion, peak, recession, trough

During a recession, economic output

 contracts for at least three years in a row

 contracts for one month

 contracts for at least six months

 contracts for at least two years minimum

At the peak of a business cycle,

real GDP is shrinking, prices are rising, and unemployment is low 

real GDP is growing, prices are rising, and unemployment is low.

 real GDP is growing, prices are falling, and unemployment is low.

 real GDP is shrinking, prices are falling, and unemployment is low.

 According to the chart below , what was the unemployment rate during the peak of the business cycle? 

3%

5%

4%

7%