A business cycle reflects changes in economic activity,particularly real GDP.What are the stages of a business cycle,in order?
A)expansion, peak, contraction, trough
B)trough, expansion, contraction, peak
C)contraction, recession, expansion, boom
D)expansion, trough, contraction, peak

Question

Quizplus · Accepted Answer

The correct order of stages in a business cycle is expansion, peak, contraction, and then trough. During expansion, the economy grows and real GDP increases. Peak refers to the highest level of economic activity before it starts to decline during the contraction phase. In contraction, economic activity slows down, and GDP starts to decline. Finally, the trough is the lowest point of economic activity before it starts to recover during the expansion phase.

A Business Cycle Reflects Changes in Economic Activity,particularly Real GDP