Question

In which phase of the business cycle would the economy be if the unemployment rate continues to rise by 2% each quarter

Answer 1

This would be known as the recession phase of a business cycle meaning Demand begins to four and there is a steady decline in employment, prices and profits, income and output. there is a noticeable reduction in investments and The banks as well as the people attempt to obtain more liquidity so, credit contracts. Expansion of business pauses making stock markets fall. People begin to lose their jobs when orders are canceled. is increase in unemployment results in a harsh decline in income as well as aggregate demand. On the bright side, a period of recession amounts for only a short time