Econ: Business Cycles

These are fluctuations, or changes, in a market system's economic activity. 

• Business Cycle
• Expansion
• Peak
• Contraction

Business cycle fluctuations are measured by increases or decreases in what? 

• Real GDP
• Nominal GDP
• GDP Per Capita
• GNP

During this phase of the business cycle, a high point is reached in the economy suggesting that it is at its strongest and most prosperous point. 

• Peak
• Contraction
• Recession
• Trough

When real GDP stops increasing, the business cycle enters a period of business slowdown known as what?

• Expansion
• Contraction

While a recession is a decline in real GDP for two or more consecutive quarters, this is a prolonged and severe version. 

• depression
• trough
• peak
• expansion 

When demand, production, and employment reach their lowest levels.

• recession
• depression
• trough
• peak

Economists rely on all of the following economic indicators to determine the phase of the business cycle EXCEPT:

• leading indicators
• coincident indicators
• lagging indicators
• money & credit

This anticipates the direction in which the economy is headed. It includes the number of building permits issued, the number of orders for new capital and consumer goods, and the price of raw materials and stock prices 

• Leading Indicators
• Coincident Indicators
• Lagging Indicators
• Public Expectations

The most important of these indicators that change as the economy moves from one phase to another include personal income, sales volume, and industrial production levels. 

• Leading Indicators
• Coincident Indicators
• Lagging Indicators
• Business Investments

These change months after an upturn or a downturn in the economy. Important items in this category include the use of consumer installment credit and the number and size of business incomes. 

• Leading Indicators
• Coincident Indicators
• Lagging Indicators
• Public Expectations