Explain The Four Phases Of Business Cycle

d. Corporations: when the price of products went down, the more of the product that was made. But the cycle got better during the “War Boom”, but went down during the “post war depression.”

go through cycles of expansion, recession and recovery. Monetary and fiscal policies can affect the timing and length of these cycles. In the expansion phase, the economy grows, businesses add jobs and consumer spending increases. At some point, known as

A recession is a conciliation of health insurance policies based on a misstatement of fact on the insures application for coverage.

Another important factor to consider when starting a business is the “business cycle.” The business cycle is the fluctuations in economic activity that an economy will experience over a period of time. We have experience may business cycles in the United States. We refer to them as expansions and recessions. In an expansions, the economic outlook is good and growth happens, without inflation. Recessions are when the economy is shrinking and the determination factors for a recession include unemployment, low industry production, decrease sales and lower incomes. Since 1854, The United States has experienced 33

Free market economy, again, creates competition which then leads to innovation from creative thinking of autonomous individuals.

Human behavior is sensitive to and strongly influenced by its environment. When the economy starts recession, manufactures would shrink the volume of production, investor will invest less and people will spend less money on new products, and as the result, which would causes the economy become worse. And on the other hand, good economy leads people to buy more.

According to the financial definition, a recession is a significant decline in activity spread across the economy, lasting longer than a few months. It is visible in industrial production, employment, real income, and wholesale-retail trade. The technical indicator of a recession is two consecutive quarters of negative economic growth as measured by a country's GDP. (Dictionary.com) A less official and more realistic definition of an economic recession is the social perception of the state of the economy at a given time. The collective beliefs of the public, mainly businesses and consumers, drive the social perception of whether things are seen as positive or negative. Unfortunately

The two economic environments that I would be describing about are recession and growth on the business activities of John Lewis. Growth occurs when more goods are being produced and consumed, and also incomes are rising. During growth people spend more money on goods and services as they have more money to spend and also businesses would invest more and hire more labour as it links to increasing demand. Recession however occurs when people involved in business become more cautious so they cut their spending down and also cut back on their orders as well as making workers unemployed or redundant.

The Business Cycle is “…the "ups and downs" in economic activity, defined in terms of periods of expansion or recession” (Dr. Econ). Expansion is the period in which employment, production, sales and income increase. Likewise, the contrasting contraction is when the actions above decrease. In order to keep track of the fluctuations of the US’s business cycles troughs and peaks, the National Bureau of Economic Research was created. The NBER is comprised of a group of economic researchers currently led by president James Poterba. The members are usually specialized in the field of business-cycle research, and are chosen by the president. The NBER was founded in 1920 as a private non-profit “…non-partisan organization dedicated to conducting economic research and to disseminating research findings among academics, public policy makers, and business professionals.” (http://www.nber.org/info.html). The NBER dating committee was formed in 1978, and plays an important role in the US as an examiner of broad measures of economic activity, and the most reliable source of the beginning and end of recessions in the U.S. This is accomplished by gathering as much data on a given period of economic activity.

All of these factors have an enormous impact on my selected business (Barclays) as the economy goes from growth and decline. As well as many others, Barclays is majorly affected as it is in the financial industry. These different factors appear throughout what is called the ‘Business Cycle’. The cycle shows the fluctuation of the activity within the economy over a period of time and consists of 4 main stages; as well as many others,

The business cycle expands and contracts as the GDP grows or shrinks. The business cycle includes periods of recession and expansion, and peaks and troughs. Although the business cycle can appear to be a volatile up and down movement, the long term movement of real GDP is generally not affected and reaches upward. In an article by Langelett and Schug (2005), the authors discuss how real GDP and business cycle changes are related. A business cycle begins with an expansion where real GDP is rising and reaches the high point or peak of the expansion (Langelett &Schug, 2005). During this time, individuals and businesses feel comfortable with the current state of the economy and begin spending more. A good economy can last many years although, inevitably, the economy will begin to slow. During times of recession, individuals and business feel uneasy about the future and reduce their spending causing the GDP to decline. The GDP is an important measure for voters to comprehend when deciding between candidates and their economic

Recession cycles are thought to be a normal part of living in a world of inexact balances between supply and demand. What turns a usually mild and short recession or "ordinary" business cycle into an actual depression is a subject of debate and concern. Scholars have not agreed on the exact causes and their relative importance. The search for causes is closely connected to the question of how to avoid a future depression, and so the political and policy viewpoints of scholars are mixed into the analysis of historic events eight decades ago. The even larger question is whether it was largely a failure on the part of free markets or largely a failure on the part of government efforts to regulate interest rates, curtail widespread bank failures, and control the money supply. Those who believe in a large role for the state in the economy believe it was mostly a failure of the free markets and those who believe in free markets believe it was mostly a failure of government that compounded the problem.

Innovation is normally used to denote the process that takes place when a product or a process is developed, from idea to market; the concept of invention only denotes the process that takes place when new ideas or solutions are generated. Baumol (2002) argues “is it possible to have lots of inventions and still lack innovations. Nevertheless, inventions are a necessary precondition for innovation”.

Jack and Sarah are between the second and third steps of the business cycle, they have developed a business idea and are preparing to move their idea into a firm. The name they chose for their new firm is iUser Accessories this is a tentative name that takes advantage of the Internet Domain name, a non-traditional barrier to entry. The have decided not to Advertise until a trademark attorney is consulted. This ethical decision will save them from being sued in the future from theft of intellectual property. Other non-traditional barriers they utilize are first mover advantage and new approach to an industry. The business they are intend to try will place 10 kiosks in malls and other high traffic areas that sell accessories for the iPhones, iPads, and iPods. In addition, they have created a series of short videos that help users make better use of their devices. These videos will be available through their web site or an app they are developing, these online options will charge a one-time fee for access. They are going to use these online resources as a part of their marketing strategy by offering promotions here.

Timing of the business cycle is not predictable, but its phases seem to be. Many economists site four phases—prosperity, liquidation, depression, and recovery. During a period of prosperity, a rise in production leads to increases in employment, wages, and profits. Obstacles then begin to obstruct further expansion. Production costs can increase, helping create a rise in prices, and