ey facts about economic fluctuations The following graph approximates business c
ID: 1146358 • Letter: E
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ey facts about economic fluctuations The following graph approximates business cycles in the United States from the first quarter of 1955 to the third quarter of 1959. The vertical blue bar coincides with periods of 6 or more months of declining real gross domestic product (real GDP) Source: "Current-dollar and Real GDP," Bureau of Economics Analysis, last modified May 1, 13, accessed May 15, 13, http://www.bea.gov/national/xls/gdplev.xls. Notice that real GDP trends upward over time but experiences ups and downs in the short run. These short-run fluctuations in real GDP are often referred to as True or False: Short-term fluctuations in real GDP are irregular and unpredictable. True False Which of the following probably occurred as the U.S. economy experienced declining real GDP in 1957? Check al that apply. Total real income declined. Car sales increased Consumer spending increased The unemployment rate increased.Explanation / Answer
The short-run fluctuations in real GDP are often referred to as "Recession"
The business cycle goes through several phases they are expansion (rise in the economy), peak (when things start to decline), Recession (when things are really down) and trough (economy start rising after hitting a trough).
The statement about the short-term fluctuation in the real GDP is irregular and unpredictable is "True". In the short term, the economy sees various fluctuations which are unpredictable and influenced by various factors like business sentiments, decline in exports because of fluctuation in other countries, increase in the price of commodity etc.
In 1957 The total real income declined and the unemployment rate increased.
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