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Which best describes features of the recovery phase in a business cycle? Select TWO.
Suggested Answer: B, D
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In the recovery phase, economies move out of recession: consumer spending rises, demand grows, and prices begin to stabilise or increase. Confidence improves, investment starts picking up, and spare capacity is gradually absorbed. Low confidence and falling investment are features of recession, while full capacity is linked to boom phases. For negotiators, recovery phases may mean suppliers regain confidence to raise prices, requiring careful market analysis.
12 comments · newest first
HE
Helene
4 months ago
I’m not so sure about B. What about A? Business confidence is still low.
GR
Gregg
4 months ago
I agree, B and D make sense. Consumer spending definitely increases.
NA
Nada
4 months ago
I think B and D are correct. Prices usually rise in recovery.
AL
Alonzo
4 months ago
E seems off, new investments usually rise during recovery.
TO
Tori
4 months ago
Definitely agree with D, consumer spending always picks up!
CO
Cory
4 months ago
Surprised to see C as an option, isn't that more for the peak?
MA
Magdalene
6 months ago
I think A is a total misconception.
SE
Selma
6 months ago
D and B are spot on!
CA
Carolynn
7 months ago
I feel like B and D are the best choices, but I’m a bit confused about C since production capacity might not be fully reached yet.
NG
Ngoc
7 months ago
I practiced a similar question, and I think D is definitely one of the answers because consumer spending usually increases in recovery.
RA
Raelene
7 months ago
I'm not entirely sure, but I remember something about business confidence improving during recovery, so maybe A is wrong?
MI
Milly
7 months ago
I think options B and D might be correct since recovery usually means prices start to rise and people spend more.