Why For RF exposure evaluations the FCC lets you average power over a set time window (typically 6 minutes for controlled/occupational exposure and 30 minutes for uncontrolled/general population). Duty cycle is the fraction, expressed as a percentage, of that averaging period during which the transmitter is actually putting out RF. A station that transmits 2 minutes out of every 6 has a 33 percent duty cycle, so the exposure averages to about one third of the peak transmit level, which makes compliance easier to meet.
Watch out The choice about the difference between PEP and average power describes the mode's own waveform duty factor (SSB voice versus FM, for example), which is a separate multiplier from the on-air time percentage; and the option about time not transmitting is exactly backwards.
Duty cycle = time ON divided by total time. Talk less, expose less.