So-Called Business Cycles Refer to the Multi-Year Periods

question 47

Multiple Choice

So-called business cycles refer to the multi-year periods:

• A) From when new products are launched to the point when they become obsolete
• B) Between the purchases of new capital equipment and the point when they become junk
• C) From the origination of a business loan to the retirement or full repayment of the loan
• D) During which the economy's overall output and employment expands and contracts

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Definitions:

Equilibrium Wage

The wage rate at which the quantity of labor firms wish to hire equals the quantity of labor workers wish to supply in the labor market.

Marginal Product

The extra output that is produced by using one more unit of a variable input, holding other inputs constant.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a resource or input.

Supply of Labor

The total hours that workers are willing and able to work at a given wage rate, in a given time period.