Business Cycle
- The business cycle is the rise and fall of economic activities that occur over time in an economy. It is also referred to as an ‘economic cycle’ or ‘trade cycle’.
- It is an alternate expansion and contraction in overall business activity, as evident by fluctuations in the gross domestic product (GDP).
- Stages:
- Depression: A continuous long term slump in economic activity.
- Boom: A period of enhanced growth in the economy.
- Recession: It refers to a prolonged slowdown in economic activity.
- Double dip recession: When a recession is followed by a brief rebound and then another recession.
