Afirm currently employs four workers in a sandwich shop, and produces sandwiches at a total cost per sandwich (atc) of $3. the sandwiches sell for $5. if the marginal cost of hiring another worker to produce sandwiches is $5.50 per sandwich, then:

a. it will cost $5.50 to make another sandwich, which can only be sold for $5.
b. the firm will lose $0.50 per sandwich if it hires another worker.
c. the firm should not hire a fifth worker.

The business cycle is the periodic but irregular up-and-down movement in economic activity, measured by fluctuations in real gross domestic product (gdp) and other macroeconomic variables. a business cycle is typically characterized by four phases—recession, recovery, growth, and decline—that repeat themselves over time. economists note, however, that complete business cycles vary in length. the duration of business cycles can be anywhere from about two to twelve years, with most cycles averaging six years in length. some business analysts use the business cycle model and terminology to study and explain fluctuations in business inventory and other individual elements of corporate operations. but the term "business cycle" is still primarily associated with larger (industry-wide, regional, national, or even international) business trends.