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Which sequence lists the four phases of a typical business cycle in the order presented in the chapter?
AExpansion, peak, contraction, trough
BContraction, trough, expansion, peak
CPeak, expansion, trough, contraction
DTrough, contraction, peak, expansion
Answer & Solution
Correct answer: A. Expansion, peak, contraction, trough
1. The chapter identifies four distinct phases of a typical business cycle.
2. They are expansion (boom/upswing), peak, contraction (recession), and trough (depression).
3. The correct option lists them in that standard order.
4. The other orderings jumble these stages.
_Source: ICAI BoS CA Foundation Paper 4 Business Economics, Ch 5 "Business Cycles", p.1_
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