Unit 1 01/21/16

Four Phases of the Business Cycle 

1. 
2. Peak- highest point of real GDP, exhibits highest spending and lowest and lowest unemployment. 
3. Expansion- real GDP increasing which is caused by an increase in spending and decrease in unemployment. 
4. Contraction/ Recession- real GDP declining for six months due to reduction in spending and increase in unemployment. 
5. Trough- lowest point of real GDP, exhibits least amount of spending and highest amount of unemployment