The Hypothesis of Political Business Cycles Asserts That

question 43

Multiple Choice

The hypothesis of political business cycles asserts that

• A) politicians can produce a favorable short-run tradeoff between inflation and unemployment to improve their chances of reelection.
• B) political popularity is not a function of the business cycle.
• C) an economic recession takes place before every national election.
• D) political manipulation of the business cycle is an effective way to increase permanent economic growth.
• E) economic expansions or contractions are a function of congressional support for the president's economic policy.

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