Question

Line graph labeled Business Cycle. Curve rises, falls, rises again, and begins to fall again. Point A marks top of first curve. Point E marks top of second curve. Point C marks bottom of curve between the two rises. B labels a black arrow spanning the fall between A and C. D labels a black arrow spanning the rise between C and E.
Public Domain

Which part of the cycle represents a period of contraction?

A
B
C
D

Answer 1

The part of the business cycle that represents a period of contraction is labeled as **B**. This section indicates the decline from Point A (the peak) to Point C (the trough). A contraction occurs during this phase as economic activity decreases.