Question

Which of the following describes a key difference between B and D? (5 points) Options: • Employment rises in B but falls in D. • Gross domestic product rises in B but falls in D. • Inflation rises in B but falls in D. • Unemployment rises in B but falls in D.

Answer 1

Answer: It's D: Unemployment rises in B but falls in D.

Explanation: Got it right on the economics test. In the graph, B is a period of contraction, with decreasing economic activity. During contraction, there is less produced and unemployment is higher. High unemployment means greater job loss and less employment. In the graph, D is a period of expansion with increasing economic activity. During expansion, more is produced and unemployment decreases.