The Peak of the Business Cycle

question 75

Multiple Choice

The peak of the business cycle:

• A) usually occurs when the natural rate of unemployment is equal to its actual rate.
• B) is the minimum level of nominal GDP.
• C) is the point where an expansion ends and a recession begins.
• D) usually occurs immediately before the expansion phase.

---

Definitions:

Rate of Return

A measure of the profitability of an investment, expressed as a percentage of the original investment.

R&D Spending

Research and Development (R&D) spending refers to the amount of money a company or country allocates towards research and innovation to develop new products, processes, or technology.

Interest-Rate Cost

The expense incurred from borrowing money, essentially the price paid for the use of borrowed funds, or, for investors, the returns from lending.