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Q: In the expansion phase of a business cycle

  • 1
    economy moves from peak to trough
  • 2
    economy moves from contraction to peak
  • 3
    economy moves from trough to peak
  • 4
    economy moves from trough to trough
  • Show Answer
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Answer : 3. "economy moves from trough to peak"
Explanation :

Answer: C) economy moves from trough to peak Explanation: Business cycles are identified as having four distinct phases: 1. Expansion, 2. Peak, 3. Contraction, and 4. Trough. Expansion is the phase of the business cycle when the economy moves from a trough to a peak. It is a period when the level of business activity surges and gross domestic product (GDP) expands until it reaches a peak. A period of expansion is also known as an economic recovery. An expansion is characterized by increasing employment, economic growth, and upward pressure on prices.

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