Business Cycle MCQs:
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Which of the following is NOT a phase of the business cycle?
- (a) Peak
- (b) Expansion
- (c) Stagnation
- (d) Trough
- Answer:(c) Stagnation
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The long-term upward trend in the economy, independent of cyclical fluctuations, is referred to as:
- (a) Business cycle
- (b) Secular trend
- (c) Recession
- (d) Inflation
- Answer: (b) Secular trend
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During which phase of the business cycle does unemployment typically reach its highest level?
- (a) Peak
- (b) Expansion
- (c) Recession
- (d) Trough
-
Answer: (c) Recession
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Which of the following is an example of a lagging indicator of the business cycle?
- (a) Stock prices
- (b) New orders for capital goods
- (c) Unemployment rate
- (d) Consumer confidence index
- Answer: (c) Unemployment rate
-
Government policies aimed at influencing the business cycle are collectively known as:
- (a) Stabilization policies
- (b) Monetary policies
- (c) Fiscal policies
- (d) Structural policies
-
Answer: (a) Stabilization policies
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Which of the following is NOT a common cause of business cycles?
- (a) Technological advancements
- (b) Changes in consumer confidence
- (c) Government spending fluctuations
- (d) Natural disasters
-
Answer: (d) Natural disasters (While they can impact the economy, they are not a recurring factor like the others)
-
During a recession, all of the following are likely to DECREASE EXCEPT:
- (a) Gross domestic product (GDP)
- (b) Investment spending
- (c) Unemployment rate
- (d) Interest rates
- Ans: d
-
The period between the peak and trough of a business cycle is called:
- (a) Recession
- (b) Expansion
- (c) Contraction
- (d) Depression
- Answer: (c) Contraction
-
Keynesian economics argues that government spending can be used to:
- (a) Shorten the duration of a recession.
- (b) Extend the duration of an expansion.
- (c) Prevent business cycles from occurring.
- (d) None of the above.
- Answer: (a) Shorten the duration of a recession.
-
Which of the following is NOT a phase of the business cycle?
- (a) Peak
- (b) Expansion
- (c) Stagnation
- (d) Trough
- Answer:(c) Stagnation
-
The long-term upward trend in the economy, independent of cyclical fluctuations, is referred to as:
- (a) Business cycle
- (b) Secular trend
- (c) Recession
- (d) Inflation
- Answer: (b) Secular trend
-
During which phase of the business cycle does unemployment typically reach its highest level?
- (a) Peak
- (b) Expansion
- (c) Recession
- (d) Trough
- Answer: (c) Recession
-
Which of the following is an example of a lagging indicator of the business cycle?
- (a) Stock prices
- (b) New orders for capital goods
- (c) Unemployment rate
- (d) Consumer confidence index
- Answer: (c) Unemployment rate
-
Government policies aimed at influencing the business cycle are collectively known as:
- (a) Stabilization policies
- (b) Monetary policies
- (c) Fiscal policies
- (d) Structural policies
- Answer: (a) Stabilization policies
-
Which of the following is NOT a common cause of business cycles?
- (a) Technological advancements
- (b) Changes in consumer confidence
- (c) Government spending fluctuations
- (d) Natural disasters
- Answer: (d) Natural disasters (While they can impact the economy, they are not a recurring factor like the others)
-
During a recession, all of the following are likely to DECREASE EXCEPT:
- (a) Gross domestic product (GDP)
- (b) Investment spending
- (c) Unemployment rate
- (d) Interest rates
- Ans: d
-
The period between the peak and trough of a business cycle is called:
- (a) Recession
- (b) Expansion
- (c) Contraction
- (d) Depression
- Answer: (c) Contraction
-
Keynesian economics argues that government spending can be used to:
- (a) Shorten the duration of a recession.
- (b) Extend the duration of an expansion.
- (c) Prevent business cycles from occurring.
- (d) None of the above.
- Answer: (a) Shorten the duration of a recession.
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