5. study questions and problems #1\nwhich of the following is considered the basic cause of the business…

5. study questions and problems #1\nwhich of the following is considered the basic cause of the business cycle?\nchanges in total output\nchanges in the unemployment rate\nchanges in the consumer price index for services\nchanges in total expenditures\nthe business cycle is caused by changes in which of the following? check all that apply.\ntransfer payments\ngross private domestic investment\ninterest rates\npersonal consumption expenditures

5. study questions and problems #1\nwhich of the following is considered the basic cause of the business cycle?\nchanges in total output\nchanges in the unemployment rate\nchanges in the consumer price index for services\nchanges in total expenditures\nthe business cycle is caused by changes in which of the following? check all that apply.\ntransfer payments\ngross private domestic investment\ninterest rates\npersonal consumption expenditures

Answer

Brief Explanations:

Business cycles are fluctuations in economic activity. Total expenditures (aggregate demand) changes drive business cycles. Transfer payments are government redistributions, not core drivers. Gross private domestic investment (part of aggregate demand), interest rates (affect investment and consumption), and personal consumption expenditures (major part of aggregate demand) impact business cycles.

Answer:

  • First question: Changes in total expenditures
  • Second question: Gross private domestic investment, Interest rates, Personal consumption expenditures