ECONOMICS
ECONOMIC GROWTH
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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To know when to open a small business
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To predict future economic events and take action
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To predict exactly when the national economy will suffer a crisis
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To help with elections and keep politicians in office
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Detailed explanation-1: -Tracking the cycle helps professionals forecast the direction of the economy. The National Bureau of Economic Research makes official declarations about the economic cycle based on specific factors, including the growth of the gross domestic product, household income, and employment rates.
Detailed explanation-2: -Factors such as GDP, interest rates, total employment, and consumer spending can help determine the current stage of the economic cycle. Insight into economic cycles can be useful for businesses and investors.
Detailed explanation-3: -The economic cycle is a trend of upward and downward movements of GDP that ultimately determines the overall long-term growth of an economy. GDP measures the aggregate value of goods and services and is used to depict the overall wealth of an economy. Higher GDP usually correlates with more well-off citizens.
Detailed explanation-4: -Knowing when an economy shifts from the peak to a recession-a decline in GDP-is the primary goal of business cycle forecasting. Businesses and investors want to know when a recession is likely to begin so that they are prepared and not spending too much money when consumption swiftly declines.