The idea that the business cycle is recurrent means that
A)declines in economic activity tend to be followed by further declines, and growth in economic activity tends to be followed by more growth.
B)the standard pattern of contraction-trough-expansion-peak occurs again and again in industrial economies.
C)many economic variables to move together in a predictable way over the business cycle.
D)peaks and troughs of the business cycle occur at regular intervals.

Question

Quizplus · Accepted Answer

The statement "the standard pattern of contraction-trough-expansion-peak occurs again and again in industrial economies" best describes the recurrent nature of the business cycle, making option B the correct answer. While there may be some variation in the timing and severity of the cycles, the general pattern of contraction, trough, expansion, and peak tends to repeat over time. Option A is incorrect, as declines in economic activity are generally followed by periods of growth, and vice versa, rather than further declines or growth. Option C is somewhat true, but the statement about predictability is not as central to the definition of a recurrent business cycle. Option D is incorrect, as the intervals between peaks and troughs can vary considerably over time.

The Idea That the Business Cycle Is Recurrent Means That