We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Nobody downloaded yet

Concept and components of business cycles - Essay Example

Comments (0) Cite this document
Summary
That is, it relates to the periodic, but irregular up and down movements in the nation’s economic activities as measured by the fluctuations in…
Download full paper
GRAB THE BEST PAPER
Concept and components of business cycles
Read TextPreview

Extract of sample
Concept and components of business cycles

Download file to see previous pages... Whenever talks are made concerning the economic or business fluctuations, notions of aggregate economic income or output is anticipated. This is because, while business cycles are expressed in terms of fluctuations in GDP, there is usually an accompaniment by labor unemployment rate fluctuations too (Parkin, 2012).
However, economists have often noted that there is variation in the lengths of a complete business cycle, as the duration may range from between two to twelve years, but averagely six years. Business cycles are significant in the sense that they highlight the economic relationships that exists in the economy. For instance, while growth in the economy will fall and rise with cycles, it generates a long-term trend line for growth. Economic growth above the trend line would result in a fall in the unemployment rate. Based on Okun’s Law, a 1% rise in GDP above the trend line would result in a 0.5% decline in the employment (Parkin & Bade, 2001).
A business cycle is often comprised of four main stages that form its components. These are the recession (trough), contraction, recovery and expansion, and growth (peak). Even though the concept of the business cycle is used in relation to the larger economy, its phases can be applied to several sections of the business or a particular industry.
The expansion and recovery phase relates to the period in which the business is rising, and consumer confidence is growing in the economy. As such, companies seize the opportunity to expand, and incomes and spending rates increase. This period is often associated with significant aggregate increase in factors such as total income, output, trade and employment rates. It persists for approximately six months, and is characterized by a widespread expansion of economic units/sectors in the economy. An extended period of this phase results in a boom in which the ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Concept and components of business cycles Essay Example | Topics and Well Written Essays - 500 words”, n.d.)
Retrieved de https://studentshare.org/macro-microeconomics/1665403-concept-and-components-of-business-cycles
(Concept and Components of Business Cycles Essay Example | Topics and Well Written Essays - 500 Words)
https://studentshare.org/macro-microeconomics/1665403-concept-and-components-of-business-cycles.
“Concept and Components of Business Cycles Essay Example | Topics and Well Written Essays - 500 Words”, n.d. https://studentshare.org/macro-microeconomics/1665403-concept-and-components-of-business-cycles.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC
Marketing Planning For Wilson Cycles
In the last couple of years, the number of fatal incidents in UK of the cyclists has increased considerably and government is taking preventive measures to ensure that the infrastructure of the country is suitable for this mode of transportation. (Ewing and Cervero, 2010 and Ogunmokun and Nyanzunda, 2009).
11 Pages(2750 words)Essay
How U.S. Government and regulatory bodies can manage business cycles
The business cycle therefore consists of periods of economic booms as well as periods of economic recession or decline. The measurement for the business cycle is often done by the government through the measure of the Gross Domestic Product (GDP) of a particular nation.
9 Pages(2250 words)Essay
Competitive Analysis and Business Cycles
Microsoft, a software manufacturing company is in a market referred to as oligopoly, a unique market structure with few firms that collectively control the largest market share. For a long time Microsoft dominated the software market thus forming a monopoly, a situation in which it was the sole manufacturer of such products thus implying that it monopolized the market.
3 Pages(750 words)Essay
Business Cycles
These fluctuations are usually measured by the real gross domestic product (GDP). One of the policy makers' main roles is to smooth out the business cycle and to reduce its fluctuations by narrowing the margin between the stages of growth and decline. The term "cycle" can be rather misleading as business cycles don't tend to repeat regularly in time.
4 Pages(1000 words)Essay
Growth and Business Cycles
I think that recessions which be much shorter and fewer of them at that, and this is mainly again due to the spending habits of the public. High priced luxury items seem to be the craze of even the average person, seemingly regardless of their income. In regards to which major trend I think will have the biggest impact on the business cycle, I believe this will be largely associated with inventory control and growth of services.
2 Pages(500 words)Essay
Real Business Cycles
The boldest conjectures are often the most fruitful, because, making the strongest claims, they are the most readily refuted and their refutation narrows the universe of acceptable conjectures most rapidly. We argue that Real Business Model (RBC) models are bold conjectures in the Popperian mold and that, on the preponderance of the evidence (to use a legal phrase), they are refuted.
19 Pages(4750 words)Essay
Macro : Business Cycles
During the recession for instance, the rate of unemployment rises and the inflation rate declines (Stock and Watson 56). The period is characterized by low level of investments and decline in the GDP. Considering the data of US in 2012, US can be said to be in the
2 Pages(500 words)Essay
Business cycles, indicators, measures, economic evolution,outlooks
Shrewsberry aged 48 to head the office. The incoming head of the office is faced with the responsibility of ensuring the wide range various businesses under the organization stay put,
2 Pages(500 words)Essay
Components of a business plan
Indeed, the customer department does have a significant role to play if the organization is to succeed. This opportunity was hence the motivating factor behind the formation of American Delivery Department Company. It is an
12 Pages(3000 words)Essay
Value of Concept of Innovation
To be creative, going beyond the boundaries is an inevitable move and in doing so, there is an intrinsic risk. What sets apart successful
4 Pages(1000 words)Essay
Let us find you another Essay on topic Concept and components of business cycles for FREE!
Contact us:
+16312120006
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us