Business Cycles Are

question 11

Multiple Choice

Business cycles are:

• A) short-term patterns of increases and decreases in economic activity around a general trend.
• B) irregular fluctuations in the level of economic activity, which rarely occur anymore.
• C) predictable economic expansions above the long-term trend.
• D) abrupt and unexpected departures from the current economic trend.
• E) periodic fluctuations in aggregate demand that depend on the time of the year.

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Definitions:

Economic Efficiency

A state where resources are allocated in a way that maximizes the production of goods and services.

Constant-Cost Industry

An industry in which the costs of production, including input prices, do not change as the industry's output changes.

Unit Price

The cost assigned to a single unit of a product or service, making it easier to compare the value of similar products or services.

Total Cost

The complete cost of production, including both fixed and variable costs incurred in the creation of a good or service.