Answer:Area a represents an economic boom, and area b is a recession
Explanation:
The dashed line is potential output and the solid line is current output; therefore area a represents an economic boom, and area b is a recession.
An economic boom occurs when the business cycle has expanded. It is a period of growth and in this period, there'll be a rise in key economic indicators such as the gross domestic product, for that country.
Area b is a recession. This is when there's a contraction of economic activities and in this period, there's a reduction in the demand of goods and services. This results in unemployment and hardship on the citizens of the country.
