Which part of real GDP fluctuate most over the course of the business cycle?
A) consumption
B) government expenditures
C) investment
D) net exports

Question

Quizplus · Accepted Answer

Investment spending tends to fluctuate the most over the course of the business cycle, as businesses may be more hesitant to invest during periods of economic uncertainty or downturns. Consumption tends to be more stable, as people still need to purchase basic goods and services even during tough economic times. Government expenditures can also be relatively stable or even increase during downturns as governments implement fiscal stimulus measures. Net exports can be affected by external factors such as global economic conditions and exchange rates, so their fluctuations may not correspond directly to the business cycle.

Which Part of Real GDP Fluctuate Most Over the Course