Business Cycle

The business cycle is made up of how many phases?

• 5

• 4

• 3

• 2

An economy is officially considered to be in recession after two consecutive (continuous) quarters of falling GDP.

• True

• False

A (An) _____ is a cause of a trough.

• brand new product

• broken product

• expensive product

• severely outdated product

Which of the following describes the growth part of the business cycle?

• Accounts for the time when business activity has reached a maximum

• Commonly defined as two consecutive quarterly declines in Gross Domestic Product

• Is the lowest levels during a recession

• Occurs when persistent increases in the key measurements of aggregate economic activities are present

What is the lowest level of a recession?

• Peak

• Pit

• Resolution

• Trough

Which of the following is NOT a business cycle indicator?

• Labor force

• National defense

• Out of date products

• Personal incomes and consumer attitudes

Which of the following describes the virtuous cycle?

• A representation concerning the patterns of expansion and contraction in the economy, consisting of the growth, peak, recession and trough phases

• An increase in sales results in increase in production which causes increase in employment leading to increased income which starts the cycle over again

• The lowest levels experienced during a recession

• The period in which business activity has reached a maximum

Which of the following lists each part of the business cycle?

• Peak, Downhill, Pit, Expansion

• Peak, Recession, Pit, Explosion

• Peak, Recession, Trough, Expansion

• Peak, Pit, Recession, Explosion

Which of the following describes the term productivity?

• Consecutive quarterly declines in Gross Domestic Product

• Measurement of physical output for each unit of input used, usually referring to labor hours

• Period in which business activity has reached a maximum

• Sum or whole amount of something

Economic recovery begins-

• above the trend line

• at the end of a recession (trough)

• at the "boom" period