The "political business cycle" refers to the possibility that:
A)incumbent politicians will be re-elected regardless of the state of the economy.
B)politicians will manipulate the economy to enhance their chances of being re-elected.
C)there is more inflation during Liberal administrations than during Progressive Conservative administrations.
D)recessions coincide with election years.

Question

Quizplus · Accepted Answer

The political business cycle refers to the tendency of politicians to manipulate the economy in order to improve their chances of being re-elected. This manipulation can take the form of policies that stimulate the economy before elections, leading to booms, followed by policies that contract the economy after elections, leading to busts.

The "Political Business Cycle" Refers to the Possibility That