Question

Which best deceived the nature of cause and effect in the context of the business cycle?

A. Each effect has other effects
B. Causes and effects cannot be easily defined
C. A cause has multiple independent effects
D. Each effect has a cause

Answer 1

The option that best describes the nature of the cause and effect in the context of the business cycle is A. Each effect has other effects.
All markets economies go through periods when consumption-spending on goods and services rises. Consumers buy more, companies invest more, and production, income, profit and employment increase. These periods are always followed by periods when investment and spending fall, and unemployment rises. This is the business cycle.