Explanation:

- Deflationary Conditions: Occur when prices consistently fall, leading consumers to delay purchases, which can slow down the economy and affect the trade cycle.

- Inflationary Conditions: Happen when prices rise too quickly, decreasing purchasing power and potentially leading to overheated economies, impacting trade cycles.

- Option 3: Both (a) and (b): Both deflationary and inflationary conditions can cause fluctuations in economic activity, influencing the trade cycle.

- Option 4: None of these: Indicates that neither inflation nor deflation affects the trade cycle, which is not accurate.

Answer: Option 3: Both (a) and (b)