Economics - Economics Section 2
1. During the early expansion phase of a business cycle, inflation is most likely to:
- Option : C
- Explanation : During the early expansion phase of a business cycle, inflation remains moderate and may continue to fall.
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2. A recession is least likely associated with:
- Option : C
- Explanation : A recession is associated with decelerating inflation.
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3. In a business cycle, a trough is most likely to be followed by a/an:
- Option : B
- Explanation : A trough is followed by an expansion.
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4. The unemployment rate is most likely to rise during which phase of the business cycle?
- Option : A
- Explanation : The unemployment rate rises in contraction, remains high in early expansion, and falls during peak.
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- Option : C
- Explanation : Inflation remains moderate but may fall during an early expansion. Generally, inflation picks up modestly during a late expansion, and decelerates with a lag during a contraction.
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