In general,as the economy expends or contracts over the business cycle
A)prices change
B)prices remain unchanged except in a recession
C)prices remain unchanged until the economy reaches full employment
D)all of the above

Question

Quizplus · Accepted Answer

Prices tend to change in response to changes in demand and supply, which are influenced by the level of economic activity. During an expansionary phase of the business cycle, demand for goods and services increases, leading to price increases. Conversely, during a downturn or recession, demand falls, leading to price decreases. Therefore, prices tend to change over the business cycle, making option A the best choice. Options B and C are incorrect as they both suggest that prices remain unchanged, while in reality, they are influenced by changes in the economy. Option D is incorrect as it includes all the options, while in reality, only option A is correct.

In General,as the Economy Expends or Contracts Over the Business