Which one of the following represents an expansion?
A) An increase in stock prices.
B) An increase in output.
C) An increase in bond prices.
D) An increase in the unemployment rate.
E) A simultaneous increase in economic activity and decrease in inflation.

Question

Quizplus · Accepted Answer

An increase in output represents an expansion as it indicates that the economy is producing more goods and services, which is a sign of economic growth. Increases in stock prices (A) and bond prices (C) do not necessarily indicate economic expansion as they can be influenced by factors such as interest rates and investor sentiment. An increase in the unemployment rate (D) is a sign of economic contraction as it indicates that fewer people are employed, while a simultaneous increase in economic activity and decrease in inflation (E) represents a healthy, but not necessarily expansionary, economy.

Which One of the Following Represents an Expansion