Business Cycles is one of 9 topics in the Grade 10 Economics CAPS syllabus, covered across 3 lessons on Study Vault. Below are real practice questions from this topic with full worked answers.
Sample practice questions
Easy
1. The business cycle refers to:
The recurring pattern of ups and downs in overall economic activity over time
A single, one-time event that never repeats
Only the growth phase of an economy, with no downturns
The daily changes in a country's exchange rate
Answer: The recurring pattern of ups and downs in overall economic activity over time — The business cycle describes the recurring, though irregular, pattern of expansion and contraction in a country's overall level of economic activity.
Easy
2. The turning point at the bottom of the business cycle, where economic activity is at its lowest before the next upswing begins, is called the:
Trough
Peak
Recession
Boom
Answer: Trough — The trough is the lower turning point of the business cycle, marking the lowest level of economic activity before the next upswing begins.
Medium
3. What term describes the phase of the business cycle when output, employment and spending are all falling and business confidence is declining?
Answer: The downswing (or contraction) — The downswing (or contraction) is the phase where economic activity is decreasing; if particularly severe and prolonged, it may be called a depression.
