Stocks whose prices tend to increase when the economy is in an expansionary stage and decline during a contractionary stage are called:
A) cyclical stocks.
B) defensive stocks.
C) speculative stocks.
D) income stocks.
E) tech stocks.

Question

Quizplus · Accepted Answer

Cyclical stocks are those that are closely tied to the performance of the overall economy. These stocks tend to do well during periods of economic expansion, as demand for goods and services increases, and tend to struggle during contractions, as demand decreases. Examples of cyclical stocks include those in the automotive, aerospace, and construction industries.

Stocks Whose Prices Tend to Increase When the Economy Is