What happens during the contraction phase of the business cycle?
A. GDP and employment both rise
B. Prices rise and spending increases
C. GDP declines and unemployment increases
D. Production exceeds full capacity

Question

Sefton · Answer

The correct answer is letter C. A contraction, also called a recession, is a period when GDP falls, businesses reduce output, and unemployment increases. In the Philippines, contraction was experienced in 2020 when the economy shut down due to lockdowns.

Answered by Sefton | 2025-05-22

What happens during the contraction phase of the business cycle? A. GDP and employment both rise B. Prices rise and spending increases C. GDP declines and unemployment increases D. Production exceeds full capacity

Answer (1)

Related Questions in Economics

[Sagot para sa’yo] Sources of Information to Find Work​

[Sagot para sa’yo] Give an example of a cultural symbol that represent Filipino identity. Explain why you consider it as a cultural symbo​

[Sagot para sa’yo] why is it essential to recognize and analyze cost within a business?

What happens during the contraction phase of the business cycle?
A. GDP and employment both rise
B. Prices rise and spending increases
C. GDP declines and unemployment increases
D. Production exceeds full capacity

[Sagot para sa’yo] Sources of Information to Find Work

[Sagot para sa’yo] Give an example of a cultural symbol that represent Filipino identity. Explain why you consider it as a cultural symbo