Which of the following is true during the expansionary phase of the business cycle?
A) The unemployment rate increases
B) The inflation rate decreases
C) Real GDP increases
D) Population falls

Question

Quizplus · Accepted Answer

During the expansionary phase of the business cycle, real GDP increases as businesses produce more goods and services to meet growing demand. This results in economic growth and a decrease in unemployment since more workers are needed to meet the increased demand. Inflation may also increase during this phase as demand for goods and services outpaces supply. The population is unlikely to fall during the expansionary phase.

Which of the Following Is True During the Expansionary Phase