With Regard to the Business Cycle, Most Modern Economists Believe

question 56

Multiple Choice

With regard to the business cycle, most modern economists believe that

• A) once a recession starts, market forces are incapable of preventing the economy from plunging deeper and deeper into a depression.
• B) market economies will experience lengthy periods of recession pretty much regardless of what policy makers do.
• C) the economy's self-corrective mechanism will quickly restore full employment regardless of the choices made by policy makers.
• D) lower real interest rates and reductions in real resource prices will help direct an economy out of recession.

---

Definitions:

Spending Variance

The difference between the actual amount spent and the budgeted amount for a specific period or category.

Travel Expenses

Costs associated with traveling for the purpose of conducting business-related activities, including transportation, lodging, and meals.

Spending Variance

The difference between the actual amount spent and the budgeted or standard amount expected to be spent.

Power Cost

The expense associated with the consumption of electrical power used in the operations of a business or manufacturing process.