Unit 3 Business Cycle

Which letter on the graph represents a recession in the business cycle?

• W

• X

• Y

• Z

Which letter on the graph represents a trough in the business cycle?

• W

• X

• Y

• Z

Which letter on the graph represents a time when inflation is occurring in the business cycle?

• W

• X

• Y

• Z

In a typical business cycle, the trough is immediately followed by:

• prosperity

• recession

• recovery

• peak

Which of the following statements BEST describes the concept of the business cycle?

• the flow of money from businesses to households as income

• the flow of goods from businesses to households

• the flow of money and goods from product markets to factor markets

• alternating periods of economic growth and decline

The percentage of the labor force that is unemployed is the:

• natural employment rate

• unemployment rate

• labor force rate

• employment ratio

The Consumer Price Index (CPI) in an indicator of which of the following?

• the size of an economy

• where in the business cycle the economy is currently

• the level of inflation or deflation

• the presence of a budget deficit or surplus

Which of the following BEST represents the equation for GDP?

• GDP = C + I + G + NX

• GDP = C + I + G - taxes + NX

• GDP = C + G + NX

• GDP = C - CPI + G + NX

Which of the following would NOT be a part of GDP?

• new residential (homes) construction

• a new Ferrari purchased by Maliek

• U.S.A. selling Chevrolets to Canada

• Faith purchasing an antique dresser

Which of the following transactions WILL be counted in the official GDP?

• Kasey sold her house at a huge gain

• Morgan bought an iPhone 15 Pro

• Yair bought illegally scalped tickets to the Atlanta United/Inter Miami game

• Sebastian bought a 2017 Jeep Wrangler