In Figure 8-1, point E represents: (1) recession and a trough. (2) recovery and a peak. (3) peak and a trough. (4) recession and a peak.

Without seeing Figure 8-1, we can infer based on typical representations of the business cycle. In standard business cycle diagrams: - **Peak**: The highest point of economic activity before a downturn. - **Trough**: The lowest point of economic activity before a recovery begins. - **Recession**: A period of declining economic activity. - **Recovery**: The phase following a trough where economic activity begins to increase. Given the options: 1. **Recession and a trough**: The trough marks the end of a recession, making this pairing logical. 2. **Recovery and a peak**: Recovery occurs after a trough, not at the peak. 3. **Peak and a trough**: These are two distinct points in the cycle and don’t occur simultaneously. 4. **Recession and a peak**: The peak is typically associated with the transition from expansion to recession, not the recession itself. **The most plausible answer is:** **(1) recession and a trough.**