A firm is said to be countercyclical if its returns:
A)Continue to decrease, year after year
B)Continue to increase, year after year
C)Are better when most firms do poorly
D)Are negative in real terms

Question

Quizplus · Accepted Answer

A countercyclical firm is one that performs better during economic downturns or recessions when most other firms are performing poorly. Therefore, its returns are better when most firms do poorly. Choices A, B, and D do not relate to the concept of countercyclical firms.

A Firm Is Said to Be Countercyclical If Its Returns