BUSINESS ADMINISTRATION
BUSINESS POLICY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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peak
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trough
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expansion
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contraction
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Detailed explanation-1: -Peak: During the expansion phase, the GDP spikes to its highest level; this is considered the economy’s peak. At this point, economic factors. read more like income, consumer spending, and employment level remain constant.
Detailed explanation-2: -The GDP is highest when the economy is at a peak. The GDP is second-highest in the expansion phase as this is the growing period where the economy tries to reach its peak. The recession comes third in the order because, during a recession, the GDP starts declining and becomes very low.
Detailed explanation-3: -The trough is the lowest point in an economic contraction, when real GDP stops falling.
Detailed explanation-4: -A sustained period in which real GDP is rising is an expansion; a sustained period in which real GDP is falling is a recession.