The Trough of the Business Cycle

question 5

Multiple Choice

The trough of the business cycle:

• A) comes right after the expansion phase.
• B) comes before the recession phase.
• C) occurs when the actual rate of unemployment in the economy is zero.
• D) is the point where a recession ends and an expansion begins.

---

Definitions:

Dividends

Payments made by a corporation to its shareholder members, usually derived from the company's profits.

Market Price

The ongoing cost for buying or selling an asset or service within a market setting.

Acid-Test Ratio

A stringent indicator of a company's liquidity, calculated by dividing liquid assets excluding inventories by current liabilities.

Company

A business organization founded by a group of individuals dedicated to pursuing and administering a commercial or industrial venture.