The Business Cycle (Edexcel A-Level Business): Flashcards
📚Flashcards
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Practise the cards
10 cards from this deck
GDP stands for?
GDP stands for?
Gross Domestic Product - measures total output in economy
Business cycle definition
Business cycle definition
Regular fluctuations in GDP over time
Four phases of business cycle
Four phases of business cycle
Boom, Downturn, Recession/Depression, Recovery
Boom phase characteristics
Boom phase characteristics
Rapid GDP growth, rising demand, high employment & profits
Technical definition of recession
Technical definition of recession
Two consecutive quarters of negative GDP growth
Recovery phase features
Recovery phase features
GDP rises, confidence returns, demand increases, unemployment falls
Products most affected by cycle
Products most affected by cycle
Non-essential & luxury items (holidays, restaurants, jewellery)
Business confidence during boom
Business confidence during boom
High - optimistic, take risks, invest in expansion
Employment as indicator type
Employment as indicator type
Lagging indicator - rises even after recession ends
Keynes' view on confidence
Keynes' view on confidence
Confidence directly affects investment decisions & cycle