Economics

Business Cycle

Business Cycle

Business Cycle is basically defined in terms of periods of expansion or recession. It is the downward and upward movement of gross domestic product (GDP) around its long-term growth trend. It is the fluctuation in economic activity that an economy experiences over a period of time. It is usually measured by considering the growth rate of real gross domestic product. Business cycle reflect the possibility that the economy may reach short-run equilibrium at levels below or above full employment.