The effect of the business cycle on the inflation rate and unemployment .

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Chapter 21, Problem 21.3.2RQ

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The effect of the business cycle on the inflation rate and unemployment.

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Part B: Growth rate in 2018 for Real GDP= 3.00% Growth rate in 2018 for Nominal GDP= 6.76% Growth rate in 2018 for Real GDP per capita = 1.99% Growth rate in 2018 for Nominal GDP per capita = 5.72% Suppose the average unemployment rate of Hong Kong from 1999 to 2018 was 4.59%. Which phase of the business cycle best describe Hong Kong’s economic situation in 2018? Briefly explain your answer.

In the fifty years before the covid-19 pandemic, the U.S. also suffered two deep recessions, in 1981-82 and 2007-2009. (As you know, the second was the Great Recession.) Based on the historical evidence in the chart, about how high does the unemployment rate rise in terrible recessions like those? Briefly explain.

What is the relationship between the business cycle and economic growth, and how do government policies aim to manage economic fluctuations?A) The business cycle has no connection to economic growth, and government policies have no impact on fluctuations.B) The business cycle represents the periodic expansion and contraction of economic activity, and government policies, such as fiscal and monetary measures, aim to mitigate the negative effects of economic downturns and support long-term growth.C) The business cycle is solely influenced by consumer spending.D) Government policies only exacerbate economic fluctuations.