Consider an economy in which existing capital is being used at a high degree, shortages in labour and goods markets are developing, and costs are rising. Which of the following terms best describes this stage of the business cycle?
A)peak
B)trough
C)recession
D)recovery
E)slump

Question

Quizplus · Accepted Answer

A peak in the business cycle represents the highest point of economic activity before a downturn or recession. In this scenario, the economy is experiencing shortages and rising costs, indicating a high degree of economic activity and potentially signaling the peak of the business cycle.

Consider an Economy in Which Existing Capital Is Being Used