During an Expansionary Phase of the Business Cycle, Which of the Following Most Likely Occurs??

Which of the following is most likely to happen during a business cycle’s expansionary phase? Unemployment decreases as real GDP grows.

Similarly, What happens during an expansionary phase of the business cycle?

The economy is in an expansionary phase when it grows for two or more quarters in a row. Consumer confidence improves when interest rates fall, employment rates increase, and consumer confidence rises. When the economy achieves its maximum productive output, the peak phase occurs, signaling the end of the boom.

Also, it is asked, Which of the following typically occurs during an expansionary phase of a business cycle?

Which of the following is most common throughout a business cycle’s expansionary phase? Employment is on the rise.

Secondly, What causes an expansion in the business cycle?

Every country’s economy goes through cycles of growth and collapse. Levels of employment, productivity, and the overall demand for and supply of the nation’s products and services all influence these changes. These shifts result in periods of growth and contraction in the near term.

Also, What happens when the economy is in expansion?

In economics, expansion is an upward trend in the business cycle marked by a growth in output and employment, which leads to an increase in consumer and company incomes and expenditure.

People also ask, Which of the following would indicate that the economy is in an expansionary phase?

Businesses are increasing their capital expenditures. Real GDP rises, earnings grow, and demand for goods and services rises during an expansionary era.

Related Questions and Answers

Which of the following will be most likely to dampen the expansionary effects of an increase in government spending financed by borrowing?

Which of the following is most likely to reduce the expansionary impacts of increased government expenditure supported by borrowing? a. The central bank will purchase more bonds as a result of the increased borrowing, lowering aggregate demand.

Which of the following are expansionary fiscal policy actions?

Expanding government spending, lowering taxes, or increasing government transfers are all examples of expansionary fiscal policy instruments. Any of these actions will boost aggregate demand, resulting in increased production, employment, and price levels.

Which combination of events described below would be the most expansionary for an economy assuming that they all happened at the same time?

Which of the following combinations of events, if they all occurred at the same time, would be the most expansionary for an economy? Reduced taxes, more government expenditure, higher net exports, and lower reserve requirements.

Which of the following occurs during an expansion?

During an expansion, which of the following occurs? Production increases, employment increases, and unemployment decreases.

What are some causes of an expansion?

Expansion may be triggered by external variables such as weather or technological development, as well as internal factors like as fiscal and monetary policies, credit availability, interest rates, regulatory policies, and other influences on producer incentives.

What is expansionary policy used for?

Expansionary policy aims to generate demand by using monetary and fiscal stimulation to stimulate an economy. The goal of expansionary policy is to avoid or mitigate economic downturns and recessions.

How does GDP affect the business cycle?

Along with GDP, a number of other economic indicators tend to alter as the economy progresses through the business cycle. Employment, earnings, industrial output, and sales all tend to rise in tandem with growing real GDP during an economic upswing.

When the economy expands Which of the following is true?

Which of the following is true as the economy expands? D) Both income tax and sales tax collections will increase. 12.

What happens to interest rates during expansion?

Interest rates will rise as a result of increased demand for money as a result of a company growth (causing the money demand curve to shift right). Interest rates will fall when the demand for money falls during a recession (causing the money demand curve to shift left).

What is it called when the economy is expanding?

When real GDP rises from a trough to a high over the course of two or more quarters, it is said to be expanding. When the economy is stimulated, there is an increase in employment, which is followed by consumer confidence and discretionary expenditure. Economic recovery is another name for this period.

In which phase of the business cycle will the economy most likely experience rising real output and falling unemployment rates?

When overall expenditure exceeds the economy’s capacity to produce output at current prices, inflation develops. In which stage of the economic cycle would the economy’s real production and unemployment rates most likely rise? Trough.

During which period was the economy in an expansion?

Following a resurgence in growth in May 1954, expansion continued. In comparison to the previous two expansions, employment and GDP growth slowed. Between 1958 and 1960, there was a two-year phase of growth, followed by another monetary recession in 1960. In 1961, a lengthy phase of growth started.

Which phase of the business cycle would be most closely associated with an economic contraction?

A contraction happens when the economic cycle reaches its peak but before it reaches its bottom. A recession, according to most economists, occurs when a country’s real gross domestic product (GDP)—the most closely monitored gauge of economic activity—declines for two or more consecutive quarters.

Which phase of a business cycle can lead an economy into recession?

Contraction is a phase that may lead to a recession in a country’s economy. A contraction phase is an economic phase, or part of a business cycle, in which real GDP is dropping.

Which of the following effects may result from an expansionary fiscal policy?

However, if used during a solid economic growth, expansionary fiscal policy may lead to higher interest rates, larger trade deficits, and faster inflation. The stimulative impacts of expansionary fiscal policy are somewhat countered by these adverse effects.

Which one of the following is an example of expansionary fiscal policy?

Tax cuts and increased government expenditure are two primary elements of expansionary fiscal policy. Both of these programs aim to boost aggregate demand while reducing budget surpluses or contributing to deficits.

How does expansionary fiscal policy increase aggregate demand?

What kind of fiscal policies boost aggregate demand? Cutting taxes and expanding government expenditure are examples of expansionary fiscal policy aimed at stimulating aggregate demand. Both provide consumers and corporations more money, enabling them to buy and invest.

What is an expansionary fiscal policy quizlet?

Fiscal Policy that is Expansionary. An increase in government purchases of goods and services, a reduction in net taxes, or a combination of the two to boost aggregate demand and grow real production. Deficit in the budget

Which of the following is an expansionary fiscal policy quizlet?

Which of the following is a kind of fiscal expansion? FEEDBACK: The goal of expansionary fiscal policy is to encourage the economy to grow. This may be accomplished by either boosting government spending or lowering taxes, both of which increase aggregate demand.

Which factor is an expansionary fiscal policy quizlet?

To boost aggregate demand, expansionary fiscal policy involves boosting government spending and lowering taxes.

Which of the following is an example of expansionary monetary policy for the Federal Reserve?

Which of the following is an example of monetary policy that is expansionary? The Federal Reserve is boosting the money supply in order to cut interest rates.

Which of the following is most likely to lead to higher economic growth?

Which of the following factors is most likely to boost economic growth? Infrastructure development at a high level.

What effect does expansionary monetary policy have on equilibrium if consumers have rational expectations?

If workers have rational expectations, an expansionary monetary policy will cause the short-run equilibrium to shift from point A to point C on the long-run Phillips curve. The rate of inflation will continue to climb, while unemployment will remain unchanged.

What happens during the expansion phase of a business cycle?

Expansion is the phase of the economic cycle in which real gross domestic product (GDP) expands for two or more quarters in a succession, going from a low to a high. Expansion is often known as an economic recovery since it is usually followed by an increase in employment, consumer confidence, and stock markets.

What happens to employment inflation and output during an expansionary phase of a business cycle?

The economy is in an expansionary phase when it grows for two or more quarters in a row. Consumer confidence improves when interest rates fall, employment rates increase, and consumer confidence rises. When the economy achieves its maximum productive output, the peak phase occurs, signaling the end of the boom.

Conclusion

This Video Should Help:

The “Which of the following is true of active fiscal policy actions?” is a question that asks which of the following is true during an expansionary phase of the business cycle. The answer to this question is that, during an expansionary phase, monetary and fiscal policies are likely to be expansionary. Reference: which of the following is true of active fiscal policy actions?.

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