Question

General sources of shocks that can cause business cycles include the following, except: A. Irregular occurrence of innovations and productivity changes B. Monetary factors and financial instability C. Unemployment jumps and production drops D. Political events, either domestic or global

Answer 1

Answer:

The correct answer to the question: General sources of shocks that can cause business cycles include the following, except:___, would be, C: Unemployment and production drops.

Explanation:

Business cycles are referred to as recurrent peak moments and valley moments of an economy throughout time and which are influenced by the levels of economic activity present in a country at a specific time. From the list provided of answers, irregular occurrence of innovations and productivity changes, monetary factors and financial instability and definitely political events, both inside or outside of a country, will cause business cycles to end and to start. However, unemployment and production drops will not affect the initiation, or ending of a business cycle. These would rather be evidence of economic contraction and possible recession.