No Bull Economics Lessons

Macroeconomics & Microeconomics Concepts You Must Know

Macroeconomic Performance (1 of 10)

Question 1:
All of the following are characteristics of the expansionary phase of the business cycle EXCEPT:

A.  rising prices
B.  shrinking inventories
C.  more domestic crime
D.  falling unemployment
E.  rising interest rates

Scroll down for correct answer

Correct Answer: C, more domestic crime. Statistics have shown that crime generally falls as an economy's health improves and expands towards the peak. Prices can be viewed as healthy and shrinking inventories means that people are buying (consuming) goods. Less unemployment means expansion.