Answer to Question #62293 in Macroeconomics for Paula

Question

Which is one of the two aspects of a business cycle?

Answer 1

The business cycle or economic cycle is the downward and upward movement of gross domestic product (GDP) around its long-term growth trend. These fluctuations typically involve shifts over time between periods of relatively rapid economic growth (expansions or booms), and periods of relative stagnation or decline (contractions or recessions). So, booms and recessions are the two aspects of a business cycle.