The following graph approximates business cycles in the United States from the f

Question

The following graph approximates business cycles in the United States from the first quarter of 1947 to the third quarter of 1951. The vertical blue bar coincides with periods of 6 or more months of declining real gross domestic product (real GDP).

A) 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 ____________

recessions

expansions

the business cycle

B) True or False: Small ups and downs in real GDP follow a consistent, predictable pattern.

True

False

C) Which of the following probably occurred as the U.S. economy experienced increasing real GDP in 1950? Check all that apply.

Retail sales increased.

The unemployment rate declined.

Consumer spending increased.

Home sales declined.

Explanation / Answer

A) the business cycle

B) False

C)

Retail sales increased.

The unemployment rate declined.

Consumer spending increased.

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