Test: Business Cycles- 1


20 Questions MCQ Test Business Economics for CA Foundation | Test: Business Cycles- 1


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QUESTION: 1

The term business cycle refers to –

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QUESTION: 2

Expansion phase all but one of the following characteristics.

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QUESTION: 3

Which one of the following is not the characteristic of business cycle?

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QUESTION: 4

The turning points of the business cycle are

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QUESTION: 5

_____ refers to the top or the highest point of business cycle.

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QUESTION: 6

Involuntary unemployment is almost zero in the _____ phase of business cycle.

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QUESTION: 7

The economy is said to be overheated at the _____ phase of business cycle.

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QUESTION: 8

Cost of living increases when business cycle is _____

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Correct Answer :- C

Explanation : Cost of living increases when business cycle is expanding.

 Over the course of several years, the economy routinely experiences a predictable pattern of boom (expansion), followed by bust (recession), followed by recovery that begins the pattern anew. This can be seen in the line marked "business cycle" in Figure 1.1 Recessions are represented by the valleys that occur in the early 1990s and 2000s, expansions are represented by the inclines after a recession and peaks that occur later in the decades. Since the 1980s, an entire cycle has taken about a decade. While the government cannot prevent cyclical fluctuations, it can attempt to soften the booms and busts of the business cycle through monetary and fiscal policy.

QUESTION: 9

There is large scale of involuntary unemployment in the _____ phase of business cycle.

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QUESTION: 10

Fall in the level of investments, fall in production, fall in employment, fall stock prices, etc. are found during _____ phase of business cycle.

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QUESTION: 11

All but one are the endogenous factors of business cycle

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Endogenous factors are factors found within a business model that pertains to the economy pertaining to a specific product. Many businesses have natural annual business cycles where demand is higher at certain periods and lower at others. Prices go up because the cyclical demand is up.

QUESTION: 12

_____ is the severe form of recession with lowest level of economic activity.

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QUESTION: 13

Fall in the interest rates is a typical feature of

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QUESTION: 14

During depression _____ industry suffer from excess production capacity.

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QUESTION: 15

The great depression of _____ caused enormous misery and human sufferings

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QUESTION: 16

The lowest level of economic activity is called _____

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QUESTION: 17

There is end of pessimism and the beginning of optimism at ______

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The economy cannot continue to contract endlessly. It reaches the lowest level of economic activity called trough and then starts recovering. After a rough patch, there is end of pessimism and the beginning of optimism which reverses the process.

QUESTION: 18

Which of the following is not the features of business cycle?

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QUESTION: 19

The trough of a business cycle occur when _____ hits its lowest point.

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QUESTION: 20

Industries that are most adversely affected by business cycles are the _____

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