The Business Cycle Answers

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

Mortgage rates are high.

Demand greatly decreases.

Mortgages become unavailable.

Housing prices increase.

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

Consumers spend less, causing worker layoffs.

Demand falls, causing production to stay at its peak.

A recession begins, causing consumers to spend more.

Goods are overproduced, causing a surplus in jobs.

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

a recession.

a recovery.

prosperity.

the peak.

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

The recession enters a recovery period.

The recession slows.

The recession accelerates.

The recession starts and stops.

Which of the following conditions is most indicative of recovery?

The economy has stopped shrinking.

The economy begins to peak.

The GDP continues to shrink.

The economy is growing again.

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