In general, during the business cycle, when economic activity is peaking:
A)interest rates begin to creep higher
B)unemployment levels are low
C)inflation begins to edge higher
D)all of the above

Question

Quizplus · Accepted Answer

During the peak of the business cycle, all of the above factors occur. Interest rates begin to creep higher as demand for credit and capital increases. Unemployment levels are low as businesses have expanded due to increased demand, and thus need to employ more workers. Inflation begins to edge higher as demand for goods and services outstrips supply, leading to price increases.

In General, During the Business Cycle, When Economic Activity Is