Which of the Following Is True of the Business Cycle

question 145

Multiple Choice

Which of the following is true of the business cycle record of the United States?

• A) Recessions have been lengthier during the last two decades than was true prior to 1980.
• B) Real GDP contracted throughout most of the 1950s.
• C) Real GDP in 2000 was approximately the same as 1950.
• D) Since 1950, the fluctuations in GDP have been less severe than before 1950.

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Definitions:

Wage Rate

The amount of money paid to a worker per unit of time, usually expressed per hour or year.

Supply Curve

A graphical representation showing the quantity of goods that producers are willing and able to sell at different prices.

Market for Labor

The economic marketplace where employers find workers and workers find jobs.

Backward-Bending

Referring to the labor supply curve, it describes the scenario where an increase in wage rates leads to a decrease in the hours worked due to an increase in income effect over substitution effect.