The business cycle shows economic fluctuations from "summary" of The Economics Book by DK
The business cycle is a concept that captures the natural ebb and flow of economic activity over time. It reflects the cyclical pattern of booms and busts that characterize modern economies. At any given point, an economy may be in a phase of expansion, contraction, peak, or trough. These phases are not fixed, but rather represent the dynamic nature of economic growth. During an expansion phase, economic activity is on the rise, characterized by increasing production, employment, and consumer spending. This period is typically marked by optimism, as businesses invest in new projects and consumers feel confident about their financial prospects. However, this phase can also lead to inflationary pressures as demand outstrips supply. Conversely, during a contraction phase, economic activity slows down, leading to a decrease in production, employme...
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