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Business Cycle

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  • Business Cycle
  • Today we will be going over the phases of the business cycle!
  • Expansion
  • In the expansion phase, there is an increase in economic activity, such as production, employment, output, wages, profits, demand and supply of products an sales.
  • Economy
  • The economy then reaches peak, where the maximum limit of growth is attained and economic indicators do not grow further. This stage marks the reversal trend of economic growth.
  • Recession
  • In the recession phase, the demand for goods and services starts declining rapidly, Prices tend to fall and economic factors such as income , output and wages start to decline.
  • Depression and Trough
  • Demand and supply of goods and services and their prices reach their lowest levels in the trough phase. There is an extensive depletion of national income and expenditure.
  • The growth in Economy continues to decline and there is a rise of unemployment in the depression phase.
  • Recovery
  • In the recovery phase, there is a turnaround from the bottom and the economy starts recovering from the negative growth rate. Demand and supply pick up and there is a positive attitude towards investment and employment.
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