Flashcards on Business Cycles: Phases, Indicators, and Causes
Business Cycles: Phases, Indicators, and Causes Explained
Tap to flip · Swipe to navigate
Business Cycle
48 cards
Card 1
Question: What is a business cycle?
Answer: Consecutive periods of increasing and decreasing economic activity.
Card 2
Question: What is time series data in the context of business cycles?
Answer: Data collected over a period of time to investigate time-related trends (e.g., GDP) used to construct business cycles.
Card 3
Question: Which phases make up the expansionary period?
Answer: Recovery and prosperity (Expansion = Recovery + Prosperity).
Card 4
Question: Which phases make up the contractionary period?
Answer: Recession and depression (Contraction = Recession + Depression).
Card 5
Question: Define expansion in a business cycle.
Answer: An upward sustained growth in economic activities from trough to peak that leads to increases in real GDP.
Card 6
Question: What is the peak in a business cycle?
Answer: The highest turning point where economic activity and real GDP are at their maximum before a downturn; near full employment and high demand causing in
Card 7
Question: Define contraction in a business cycle.
Answer: A downswing in economic activities from peak to trough showing rapid decreases in production, employment, and GDP.
Card 8
Question: What is the trough in a business cycle?
Answer: The lowest turning point where economic activity and real GDP are at their minimum before recovery; characterized by high unemployment and low demand
Card 9
Question: What does the trend line on a business cycle graph show?
Answer: The general direction of an economy over time; a positively sloped trend line indicates long-run economic growth.
Card 10
Question: How is the length of a business cycle measured and what does it indicate?
Answer: Measured from peak to peak or trough to trough; longer cycles indicate sustained economic stability, shorter cycles suggest instability or frequent fl