Which of the following will most likely occur during the expansionary phase of a business cycle?
A) Real GDP rises, and unemployment falls.
B) Real GDP declines, and inflation rises.
C) Interest rates rise, and the number of business failures rise.
D) Inflation rises, and employment falls.

Question

Quizplus · Accepted Answer

During the expansionary phase of a business cycle, the economy is growing, businesses are prospering, and consumer spending is increasing. As a result, real GDP rises, creating more employment opportunities and decreasing unemployment.

Which of the Following Will Most Likely Occur During the Expansionary