When entrepreneurs are pessimistic about future market conditions:

CA Foundation · Business Economics · PYQS · January 2025
When entrepreneurs are pessimistic about future market conditions:
(A) A. It does not impact the economy.
(B) B. Expansionary phase may begin.
(C) C. Economy faces contraction in economic activities.
(D) D. Investments tend to increase.

Suggested Answer and Working Notes:

Correct Answer: Option (C)

C. Economy faces contraction in economic activities.

Topics: Business Cycles

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