1. Business Cycles
Answer: A. Answer B is similar to the Business School concept of product life cycles, but not to economic business cycles. Changes in the unemployment rate, answer D, may appeal to you but the business cycle refers to the physical output of the economy (real GDP). During an economic recovery phase where real GDP is growing it is quite possible for the unemployment rate to increase through changes in frictional and structural unemployment.
File last modified: September 1, 2002
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