Compare and contrast the phases of the business cycle.
175 Words Minimum.
Business cycle is economic fluctuation in production of goods and services, trade and general activities. It is upward or downward movement of GNP level with respect to time which are known as contraction and expansion of economy in long run.
Peak is the highest point when all factors of production are working at their full capacity, employment is at its fullest.
Expansion is the phase when there is rise in economic growth, prices are rising, employment is rising.
Contraction is an economic phase when there is fall in economic growth, prices are falling and employment is also falling.
Through is an economic phase when the economy reaches it lowest point and unemployment is at highest level.
Developing countries are on expansion phase while developed economy faces peak phase of economic cycle.
Compare and contrast the phases of the business cycle. 175 Words Minimum.
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