Which statistic do economists use to measure the business cycle?
A)changes in the inflation rate
B)changes in real gross domestic product
C)changes in gross private investment
D)changes in the implicit price deflator

Question

Quizplus · Accepted Answer

Economists typically use changes in real gross domestic product (GDP) to measure the business cycle. GDP is a measure of the total goods and services produced in an economy, and changes in GDP can indicate whether the economy is in a period of expansion or contraction. Other economic indicators such as changes in the inflation rate or gross private investment can also be useful in understanding the business cycle, but they are not the primary statistics used by economists. Changes in the implicit price deflator, which measures the overall price level of goods and services produced, can be useful in understanding inflation and other economic trends, but are not directly tied to the business cycle.

Which Statistic Do Economists Use to Measure the Business Cycle