Boom stage unemployment question

• A. Companies profit, optimism, investments -> high expenditure
• B. Capacity and labor fully utilized (low unemployment)
• C. Budget surplus (incrsd tax rev)
• D. Growth/bottleneck shortages

Answer: (B)

During a boom, demand is strong and the economy uses its resources nearly to full capacity, so unemployment falls toward its natural rate. The option that says capacity and labor are fully utilized directly expresses this low-unemployment situation, making it the best fit for the boom stage. In contrast, the other ideas describe outcomes of a thriving economy—firms expanding, higher profits and investment, or fiscal changes from increased activity—but they don’t pinpoint the unemployment level as clearly as the idea of full capacity use and low unemployment.