A business cycle is the period of time in which:
a. expansion and contraction of economic activity are equal.
b. the price level changes.
c. a business is established and ceases operations.
d. there are four phases which are: peak, recession, trough and recovery.
d
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Many manufacturers sell products labeled as having imperfections at a discount at their factory outlets but do not ship these imperfect goods to regular retail outlets. Why?
What will be an ideal response?
If a monopolistically competitive firm is earning profits in the short run:
A. barriers to entry will allow the firm to enjoy them in the long run as well. B. it is acting like a perfectly competitive firm. C. other firms have an incentive to enter the market. D. it should leave the industry before it gets competed away.
The official unemployment rate disguises the extent of the unemployment problem because: a. children are not counted as unemployed
b. retired persons are not counted as unemployed. c. full-time students are not counted as unemployed. d. discouraged workers are counted as unemployed. e. people overqualified for their current job are not considered unemployed.
Suppose that a competitive market is initially in equilibrium. Then demand increases. If entering firms face the same costs as existing firms and sufficient resources are available for entering firms,
a. the long-run market supply curve will be upward sloping. b. the long-run market supply curve will be perfectly elastic. c. in the long run firms will suffer economic losses, leading them to exit the industry. d. the number of firms will decrease, and the market will become a monopoly.