Business Cycles Macro Economic Conditions And Its Impact Towards The Country

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Economics for Business
Essay Question

Lecture Name - Maruf Mostafa
Student Name - Wastu Kankanamalage Gayani Chathurangi Maithripala
Student ID – 11621711
Word Count – 1000

This essay will mainly focus, discussing business cycles in macro-economic conditions and their impact towards the country. The first part of the essay will describe different economic conditions within the macro-economic such as an economy boom and recession. The argument will bring out some definitions to provide more depth to the discussion. The latter part of the essay will illustrate the aggregate demand and aggregate supply model to demonstrate the relationship between gross domestic product (GDP) and the price level by using different …show more content…

The positive swings or the high growth in the economic activities is called contractions and the down swings and declining growth in the economic activities is called a recession.
According to the National Bureau of Economic Research, Recession is a critical decline in economic activity over the period of time and it will be evident through economic performance activities such as GDP, income, employment, industrial production, and wholesale-retail sales. (National Bureau of Economic Research)

Aggregate demand and Aggregate supply Model
The aggregate demand and aggregate supply models are related to describe macroeconomics and referred to as the AS/AD model. This model is a useful tool to evaluate the gross domestic product (GDP) against the price level and the AS/AD model is used in this discussion to explain business cycles including, recession, stable economy and contractions (Hess, P. N. 2013)
The supply curve (AS) curve refers to the quantity of output supplied by the business sector to the price of output while the demand curve (AD curve) refers to the quantity of output demanded by the various sectors of the economy. (DeLong, J. B. 2003) The quantity of real GDP is calculated based on three key inputs such as labour (L), capital (K) and technology (T) within the economy (Hubbard 2012)
There are two

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