Why is the business cycle so important to Canadian National Railway?
A)Canadian National Railway plays a key role in setting the price level.
B)Fewer goods are shipped by rail now than in the past.
C)Consumer spending rises and falls with the business cycle, which causes demand for shipping services to rise and fall.
D)The business cycle causes consumers to permanently increase their consumption of services, permanently reducing the demand for shipping by rail.
E)The business cycle causes the federal government to invest more in upgrading the railway system.

Question

Quizplus · Accepted Answer

The business cycle affects consumer spending, which in turn affects demand for shipping services. As a result, Canadian National Railway, which is a major player in the freight transportation industry, is impacted by the ups and downs of the business cycle. When the economy is doing well, consumer spending increases, leading to higher demand for shipped goods and therefore contributing to Canadian National Railway's bottom line. Conversely, during economic downturns, consumer spending decreases, leading to lower demand for shipped goods, and negatively impacting the company's profits.

Why Is the Business Cycle So Important to Canadian National