What describes the recovery phase of the business cycle?

The recovery phase of the business cycle is characterized by improvements in economic activity following a recession. During this phase, demand for goods and services begins to increase gradually as consumers and businesses regain confidence in the economy. This gradual rise in demand often leads to increased production levels as companies respond to the heightened consumer interest, which can also result in job creation and lower unemployment rates over time.

In a recovery, businesses start to invest again, leading to growth and expansion, which subsequently stimulates further demand. As consumers feel more secure about their financial situations, they tend to spend more, contributing to the overall improvement in the economy. Therefore, the option that describes this phase accurately is the gradual rise in demand.