An increase in real GDP shortly before a presidential election could signal the start of
A)a political business cycle.
B)an economy-wide supply shock.
C)a real business cycle.
D)a permanent reduction in the inflation rate.
E)long-term economic growth.

Question

Quizplus · Accepted Answer

An increase in real GDP shortly before a presidential election could be a result of a political business cycle, where politicians use expansionary policies to boost the economy before an election to increase their chances of being reelected. This is a short-term phenomenon and not necessarily indicative of long-term economic growth.

An Increase in Real GDP Shortly Before a Presidential Election