The business cycle презентация

The Financial University under the Government of the Russian Federation Rabunets Alexey a second-year student of the Faculty of Economic and Finance

What is mean a business cycle? A business cycle refers to periods of expansion and contraction. A peak is the high point following a period of economic expansion. A trough is the low point following a period of economic decline.

4 stages of business cycle Boom Through\depressinon Recession Recovery

BOOM characteristics The business outlook is extremely optimistic. The important features of prosperity are: a high level of output ,trade, employment and income, a high level of effective demand and high marginal efficiency of capital, a large expansion of bank credit, and a rising trend in prices, profits and interest rates.

DEPRESSION characteristics Phase during which the downward trend in the economy slows down and eventually stops Economic activities once again register an upward movement Period of severe strain on the economy Economy registers a continuous and rapid upward trend in output, employment, etc. It enters the phase of recovery

RECESSION characteristics During recessions, many macro economic indicators vary in a similar way. Production, as measured by gross domestic product (GDP), employment, investment spending, capacity utilisation, household incomes, business profits, and inflation all fall while bankruptcies and the unemployment rate rise.

RECOVERY characteristics The rising price of an asset Increased economic activity during a business cycle, resulting in growth in the gross domestic product. Collection of all or a portion of a debt previously considered uncollectible. Valuable materials remaining after processing. Proceeds from the sale of an asset that represent depreciation that has already been taken.

PEAK characteristics Slackening in expansion rate Highest level of prosperity Downward slide in economic activities