Question

A business cycle can indicate that an economy is in a recession if:

A. the economy experiences growth in GDP but rising
unemployment
B. the economy has a shorter period of expansion than usual.
C the economy remains in a contraction for two quarters.
R the economy rapidly switches from a trough to a peak.

Answer 1

Answer: The economy remains in a contraction for two quarters

Explanation: taking test

Answer 2

C the economy remains in a contraction for two quarters.

Step-by-step explanation:

A recession is a period characterized by a decline in the level of economic activities. A decrease in the GDP value indicates the slowing down of economic activities. Should be GDP value decline for two or more consecutive quarters, the economy is said to be in a recession. Slowing down or decline in economic activities is referred to as contraction.

During a recession, the level of unemployment rises, demand for goods and services reduces, and income levels also decline. Recessions usually last between six to eighteen months. A prolonged recession results in depression.