Business cycles

The term business cycle refers to –

• fluctuations in aggregate economic activity over time.

• ups and down in the production of goods

• increasing unemployment

• declining savings

The turning points of the business cycle are

• Expansion and Peak

• Peak and Contraction

• Contraction and Trough

• Peak and Trough

Involuntary unemployment is almost zero in the _____ phase of business cycle.

• Expansion

• Contraction

• Trough

• Depression

Fall in the level of investments, fall in production, fall in employment, fall stock prices, etc. are found during _____ phase of business cycle.

• expansion

• boom

• peak

• recession

Fall in the interest rates is a typical feature of:

• recovery

• boom

• depression

• contraction

During depression _____ industry suffer from excess production capacity:

• capital goods

• consumer durable goods

• non-durable goods

• capital and consumer goods both

There is end of pessimism and the beginning of optimism at ______

• expansion

• peak

• recession

• trough

Which of the following does not occur during expansion phase?

• Consumer spending increases

• Employment increases as demand for labour rises

• Business profits and business confidence increase

• None of the above

When aggregate economic activity is declining, the economy is said to be in _____

• contraction

• an expansion

• a trough

• a turning point

The low point in the business cycle is referred to as the

• expansion

• boom

• trough

• peak