What are the different phases of the business cycle, and how are production and employment affected in each phase?
What will be an ideal response?
The business cycle is alternating periods of economic growth and contraction. During a period of growth the economy expands, production increases, and unemployment declines. The growth phase reaches a peak, and the economy then begins to contract; production decreases, and unemployment increases. The contraction ends in a trough, and the economy starts to expand again. The cycle looks like a roller coaster track.
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GDP measures the economy's production of:
a. final goods and services. b. intermediate goods. c. consumer goods and services. d. capital goods.
In the 1970s and 1980s policies that required retirement of people over age 65 were repealed. Which variable would this directly affect?
a. The employment-population ratio b. Productivity c. Average hours d. Population e. Technology