The Business Cycle - Matt Marks | Laabri | Nneɛma a ɛma wotumi yɛ ade

Watch the following videos to understand Supply & Demand:

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Economists recognize that the economy doesn't grow smoothly, but in regular patterns. They refer to this as:

the circular flow of economic activity

the Business Cycle

the Classical Model

the Keynesian Cycle

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The business cycle has two phases and two turning points, as follows

recession, trough, advance, peak

expansion, intermediate 1, recession, intermediate 2

expansion, peak, reversal, prosperity

expansion, peak, contraction (recession), trough

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The business cycle can be affected by static effects such as:

Health Pandemic

Changes in consumer spending habits

War

Changes in business and government spending

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The business cycle can be affected by shocks such as

Covid Pandemic

Changes in consumer spending habits

Changes in business and government spending

War

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During a recession, economic output

contracts for at least three years in a row

contracts for one month

contracts for at least six months

contracts for at least two years minimum

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At the expansion phase of a business cycle,

real GDP is shrinking, prices are rising, and unemployment is low

real GDP is growing, prices are rising, and unemployment is low.

real GDP is growing, prices are falling, and unemployment is low.

real GDP is shrinking, prices are falling, and unemployment is low.

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At the contractionary phase of a business cycle,

real GDP is flattening and unemployment is the same.

real GDP is growing and unemployment is decreasing.

real GDP is shrinking and unemployment is rising

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According to the chart below , what was the unemployment rate during the peak of the business cycle?

3%

5%

4%

7%

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According to the chart below, based on Real GDP, what year did we find ourselves in a recession?

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According to the chart below, based on Real GDP, what stage of the business cycle were we in between the end of the year in1994 and and the end of the year 1995?

Expansion (Recovery)

Contraction (Recession)

Trough

Peak (Prosperity)