Economic Fluctuations Quiz

Economic fluctuations involve periods of both expansion and contraction in economic activity.

A recession is a phase in the business cycle marked by a decline in economic activity.

Expansion refers to a period of sustained economic growth and expansion.

Increasing GDP is not a characteristic of a recession; instead, GDP typically decreases during a recession.

Depression is a term used to describe a prolonged period of economic decline.

Technological advancements are not typically considered a direct cause of economic fluctuations.

Gross Domestic Product (GDP) is a common indicator used to assess whether an economy is in a recession.

Peak is the term used to describe the highest point of economic activity in the business cycle.

Fiscal stimulus is a fiscal policy tool, not a monetary policy tool.

A temporary economic downturn lasting less than a year is referred to as a recession.

John Maynard Keynes proposed the theory of 'animal spirits' to explain economic fluctuations.

The unemployment rate is typically lowest during the expansion phase of the business cycle.

A period of rapid economic growth and high employment levels is referred to as a boom.

Stagnation refers to the situation in which an economy experiences a prolonged period of negative economic growth and high unemployment.

The economy reaches its highest level of economic activity during the peak phase of the business cycle.