Question

Which statement is correct?

A. All sectors of the economy are affected to similar degrees by business fluctuations
B. Real output and employment generally show little variance over the business cycle
C. The production of nondurable consumer goods is more stable than the production of durable consumer goods over the business cycle
D. Recessions have not been severe because economists and statisticians have been able to predict their occurrence and intensity with high accuracy

Answer 1

Answer: (C) The production of non durable consumer goods is more stable than the production of durable consumer goods over the business cycle.

Step-by-step explanation:

The consumer durability of the goods has the significant life span and the production of the non durable goods of the consumer are basically purchased for the immediate consumption over the business cycle so that is why it is more stable as compared to the production of the durable goods.

The example of the durable consumer goods are smartphones, furniture and the other household appliances. On the other hand, the non durable consumer goods are more stable as it contain daily use material like food, clothes and beverages.