4. (a) What is the business cycle? (b) Draw a hypothetical graph of a business cycle labelling the four phases of the cycle. (c) Explain what is happening during each phase of the cycle with: i. Output ii. Employment iii. Inflation

4. (a) What is the business cycle? (b) Draw a hypothetical graph of a business cycle labelling the four phases of the cycle. (c) Explain what is happening during each phase of the cycle with: i. Output ii. Employment iii. Inflation

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter21: Unemployment

Section: Chapter Questions

Problem 2SCQ: Using the above data, what is the unemployment rate? These data are U.S. statistics from 2010. How...

See similar textbooks

Related questions

Q: Question 20 Revisit Later Q. "The National Statistical Office, which is under the Union Ministry of…

A: First of all, we have to discuss the term Gross Domestic Product (GDP). GDP or Gross Domestic…

Q: 1. Key facts about economic fluctuations The following graph approximates business cycles in…

Q: 2 The standard definition of a “recession” is Select one: a. two or more consecutive quarters of…

A: The term 'recession' is used in economics to describe a significant decline in economic activity…

Q: Using your knowledge of price indexes, answer the following questions. (a) In a base year, what will…

A: In an economy, price indexes are the tools to measure the changes in the price level or inflation…

Q: Nominal GDP- -Real GDP 1000 800 600 400 200 1990 1995 2000 2005 2010 Years FIGURE 20-1 Refer to…

Q: During an economic expansion, real GDP ____ and unemployment ____. (a) increases, increases (b)…

A: Labor, which is an deterministic factor of Real GDP. That is Real GDP = Y= f(L, others).

Q: produces hotdogs and buns in the following quantities and prices in 2016 and 2017. Assume also that…

A: GDP measures the market value of goods and services produced in an economy within a given period of…

Q: . Which of the following question is one of the most interest for macroeconomics. (a). Why do…

A: Macroeconomics aids in the study of performance, structure, behavior as well as in decision-making…

Q: how the US GDP has performed from January 2017 to August 2021. (i) Excluding COVID-19 reason,…

Q: Question 25 Look at the graph illustrating the stages in the business cycle. Then answer the…

A: Fluctuation in the GDP is known as the business cycle.

Q: 16. Real GDP will increase A) only if the price level rises. B) only if the price level falls. C)…

A: GDP is the gross domestic product. GDP is defined as the market value of all the final goods and…

Q: (A) For two straight quarters, business inventories increase at a sharp rate. This most likely…

A: Since you've posted multiple independent questions, according to our guidelines, only the first…

Q: What is a Business cycle? Why Business cycle essential to the economy?

A: A business cycle is also referred to as an economic cycle and can be used to carry out an analysis…

Q: other industries, 2,000 spend three months looking for a job but get discouraged and decide to stay…

A: The correct answer is given in the second step.

Q: 21. What you mean by business cycles? What are their consequences? 22. All industrialized countries…

A: The business cycle, which is also known as the trade cycle refers to the economic changes over a…

Q: Notice that real GDP trends upward over time but experiences ups and downs in the short run. A…

A: Real GDP is a measure of a nation's economic production that accounts for inflationary effects.…

Q: 5. Which of the following statements is TRUE? (A) When supply rises, the price goes up. (B) The GDP…

A: Answer: Explanation: In option A the given statement is wrong because When supply rises, the price…

Q: 43. Which of the following variables does NOT cause business cycles, according to classical…

A: The cycle that tends to depict the decline and growth of business in an economy that is being…

Q: low. You will need to use a calculator or Excel. Real GDP quantity index, base year 1915 equals_100…

A: The value of all goods and services generated by an economy in a given year is reflected in the real…

Q: 2. Suppose an economy begins in steady state. By what proportion does per capita GDP change in the…

A: The measure that depicts the final value of goods and services being produced in an economy during a…

Q: Unemployment Question The small country of Macroland has a population of 100,000 people over the age…

A: Since you have asked a question with multiple sub-parts, we will solve the first three sub-parts for…

Q: 2. Why is it important to keep track of Business Cycles? Explain. Why is it more important to look…

A: The business cycle or the economic cycle refers to the fluctuations in the level of economic…

Q: Instruction: Enter your responses as whole numbers. Average duration: Minimum duration: Maximum…

A: Recession is a period during which growth in real GDP is lower than the average. During a recession,…

Q: The term "business cycle" (or economic cycle or boom-bust cycle) refers to economy-wide fluctuations…

A: The fluctuation in the economic activity is tracked by the business cycle. In an economy, the fall…

Concept explainers

Demand and Supply

The concept of demand and supply is important for various factors. One of them is studying and evaluating the condition of an economy within a certain period. The analysis or evaluation of the demand-side factors is important for the suppliers to understand the consumer or individual behaviour. The evaluation of supply-side factors is important for the consumer or individuals to understand that what kind of combination of an economic good or what kind of economic good and services he or she should consume to maximise his utility and minimise the cost. Therefore, in microeconomics, both of these concepts are extremely important to have an idea that what exactly is going on in the economy.

Question

4. (a) What is the business cycle?
(b) Draw a hypothetical graph of a business cycle labelling the four phases of the cycle.
(c) Explain what is happening during each phase of the cycle with:
i. Output
ii. Employment
iii. Inflation

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Trending now

This is a popular solution!

Step by step

Solved in 4 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

How do you convert a series of nominal economic data over time to real terms?
Question 2 The term "business cycle" (or economic cycle or boom-bust cycle) refers to economy-wide fluctuations in production, trade, and general economic activity. From a conceptual perspective, the business cycle is the upward and downward movements of levels of GDP (gross domestic product) and refers to the period of expansions and contractions in the level of economic activities (business fluctuations) around a long-term growth trend. (a) Explain the phases of business cycle using a graph. (b) Define monetary policy. Explain how monetary policy used to control unemployment.
2 The standard definition of a “recession” is Select one: a. two or more consecutive quarters of falling Real GDP. b. the lowest point in a business cycle. c. the declining production phase of a business cycle
3
Economics 2. Why is it important to keep track of Business Cycles? Explain. Why is it more important to look at longer term (secular) trends vs. shorter term (seasonal) trends while looking at business cycles? Why are economic indicators helpful in analyzing business cycles? Explain. Macroeconomics
Macroeconomic information for an economy is given below. (a) How much productive did labor become from Year 1 to Year 2? (b) What was the inflation rate between Year 1 and Year 2? (c) What was the unemployment rate in Year 1? In Year 2? Please show your work. Year 1 8000 Output (pizzas) Employment (workers) 700 Unemployed (workers) 70 770 Labor force (workers) Price per pizza $8.00 Year 2 9000 800 100 900 $9
Please no written by hand solutions In economics, the term indexing refers to . . . (a) adjusting real values for changes in nominal value. (b) adjusting nominal values for output values. (c) adjusting the nominal value of something in order for it to maintain its real value. (d) adjusting prices for changes in government's tax rates. For the next seven questions, match the description in column B with the economic concept in column A: COLUMN A COLUMN B 19. Domestic 20. Legal tender 21. National 22. Savings 23. Real GDP 24. National income 25. Potential GDP (a) the influence of inflation is eliminated (b) full use of resources (c) within the boundaries of the country (d) permanent inhabitants of a country (e) the same as NNP at factor costs (f) difference between income and consumption (g) creditors must accept this money in repayment of debts.
Practice Your Knowledge of Business Cycles. Explain each of your choices. (A) For two straight quarters, business inventories increase at a sharp rate. This most likely indicates * an expanding economy * a recovering economy the beginning of * a recession an increase in inflation * a record unemployment rate (B) At which point in the business cycle is there the largest inflationary gap? * The peak *The trough * During expansion During contraction * At full employment (C) If the consumer price index begins to increase dramatically, which of the following is likely true? * The output gap is positive and near the peak. * The output gap is positive and near the trough. * There is no output gap and the economy is growing. * The output gap is negative and near the peak. The output gap is negative and near the trough.
3) Fill out the missing numbers in the table below. You will need to use a calculator or Excel. Percent change Real GDP Chained (1915) quantity index, base year 1915 equals 100 in real GDP from Nominal dollar Year previous year GDP real GDP index 1914 3 121 1915 5 125 1916 -2 120
4
Need help with macroeconomics question
1. Key facts about economic fluctuations Help me check it !!! The following graph approximates business cycles in the United States from the first quarter of 1953 to the third quarter of 1957. The vertical blue bar coincides with periods of 6 or more months of declining real gross domestic product (real GDP).