The Figure Given Below Represents the Business Cycle of an Economy.?Figure

question 32

Multiple Choice

The figure given below represents the business cycle of an economy.?Figure 7.1

-Refer to Figure 7.1. The overall upward trend in real GDP reflected by this figure implies that:

• A) the real GDP gap is widening over time.
• B) cyclical unemployment is growing at positive rates.
• C) consumer purchasing power is falling over time.
• D) on average, labor productivity is declining.
• E) expansionary phases outweigh contractionary phases in the economy over time.

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Definitions:

Labor Rate Variance

The difference between the actual cost of labor and the expected (or standard) cost.

Labor Standards

Benchmarks or criteria set for the amount of time and effort required to perform tasks efficiently and effectively.

Direct Labor-Hours

The total hours worked directly on the production of goods or provision of services, often used as a basis for assigning labor costs to products.

Labor Efficiency Variance

The difference between the actual hours worked and the standard hours expected to complete a task, multiplied by the standard labor rate.