AnswersHSA 26-27 EconomicsThe Business Cycle

The Business Cycle Answers

10 verified answers1 views
1
Free Preview

This is a graph of the business cycle.Time is measured along the x-axis. What is measured along the y-axis?

Question illustration
A
employment levels
B
prices
C
economic output
D
demand
2
Free Preview

When production is very high but demand is very low, it can lead to

a
a recession.
a
a recovery.
p
prosperity.
t
the peak.
3

Which of the following is a characteristic of prosperity in the peak phase of the business cycle?

s
stagnant prices
h
high levels of production
a
ambivalence about the economy
r
reduced incomes
4

best

C
Consumers spend less, causing worker layoffs.
D
Demand falls, causing production to stay at its peak.
A
A recession begins, causing consumers to spend more.
G
Goods are overproduced, causing a surplus in jobs.
5

Which indicators do economists use to determine the state of the economy? Choose three answers.pricesimmigration levelsagricultural outputemployment levelsgross domestic product (GDP)

p
prices
i
immigration levels
a
agricultural output
e
employment levels
g
gross domestic product (GDP)
6

The graphs show the US unemployment rate and the price of whole milk between 2006 and 2012.

Question illustration
T
There is no link between prices and unemployment.
R
Rising unemployment rates drive prices higher.
F
Falling prices drive unemployment rates lower.
A
As unemployment rates rise, average prices fall.
7

During a recession, what is one way governments try to encourage growth?

b
by increasing unemployment benefits
b
by stopping government spending
b
by requiring firms to maintain production
b
by eliminating all tax breaks
8

Which statement best describes why it is difficult to sell a home during a recession?

M
Mortgage rates are high.
D
Demand greatly decreases.
M
Mortgages become unavailable.
H
Housing prices increase.
9

Read a passage from a speech given by President Barack Obama.Because of this plan, families who are struggling to pay tuition costs will receive a $2,500 tax credit . . . And Americans who have lost their jobs in this recession will be able to receive extended unemployment benefits.–President Barack Obama, February 4, 2009

A
It describes government measures to stimulate demand and bring about a recovery.
B
It describes government measures to increase production and bring about a depression.
C
It describes a shift in government policies during a trough on the business cycle.
D
It describes a shift in government policies during a peak on the business cycle.
10

best

t
the interactions between producers and consumers
t
the change in production cost
m
macroeconomic trends
s
supply and demand trends
11

Which best describes the nature of cause and effect in the context of the business cycle?

A
Consumers spend less, causing worker layoffs.
B
Demand falls, causing production to stay at its peak.
C
A recession begins, causing consumers to spend more.
D
Goods are overproduced, causing a surplus in jobs.
12

Which statement best describes why it is difficult to sell a home during a recession?

A
Mortgage rates are high.
B
Demand greatly decreases.
C
Mortgages become unavailable.
D
Housing prices increase.
13

There are four stages in an economic recovery. 1. increased production2. rising demand (occurs twice)3. increased hiring In which order do these stages occur?

A
2, 1, 2, 3
B
3, 2, 1, 2
C
2, 3, 1, 2
D
2, 1, 3, 2
14

This is a graph of the business cycle.Time is measured along the x-axis. What is measured along the y-axis?

Question illustration
A
employment levels
B
prices
C
economic output
D
demand
15

When production is very high but demand is very low, it can lead to

A
a recession.
B
a recovery.
C
prosperity.
D
the peak.
16

Which of the following is a characteristic of prosperity in the peak phase of the business cycle?

A
stagnant prices
B
high levels of production
C
ambivalence about the economy
D
reduced incomes
17

Which indicators do economists use to determine the state of the economy? Choose three answers.

A
prices
B
immigration levels
C
agricultural output
D
employment levels
E
gross domestic product (GDP)
18

Which best describes how a recession develops as demand and production decrease?

A
The recession enters a recovery period.
B
The recession slows.
C
The recession accelerates.
D
The recession starts and stops.
19

During a recession, what is one way governments try to encourage growth?

A
by increasing unemployment benefits
B
by stopping government spending
C
by requiring firms to maintain production
D
by eliminating all tax breaks
20

Which event most likely explains renewed demand in a recovery period?

A
Consumers choose to save more and spend less.
B
Economic policy renews consumer confidence and demand.
C
Producers decrease prices to prompt demand and recovery.
D
Production decreases to prompt increased demand.

Did you find these answers helpful?

More from this Course

Quiz
17 verified answers

The Business Cycle

Quiz
10 verified answers

The Business Cycle

Quiz
10 verified answers

The Business Cycle