Which of the Following Does NOT Occur as the Economy

question 92

Multiple Choice

Which of the following does NOT occur as the economy moves from an expansion to a recession?

• A) An initial decrease in autonomous spending is the trigger that creates the business cycle turning point.
• B) The change in planned spending exceeds the change in real GDP.
• C) The multiplier process reinforces any decrease in spending and pushes the economy into recession.
• D) Incomes fall during recessions as firms cut production in response to unplanned increases in inventories.

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