The Business Cycle

The Business Cycle

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  • Hey there son how was the park today?
  • The park was alright dad but I have a question what's a business cycle?
  • Well son the business cycle has 6 different stages to it 
  • Well what are the 6 different stages to the business cycle dad?
  • well son the 6 stages of the business cycle are the expansion, peak, recession, depression, trough, and recovery
  • Are we at the peak of the business cycle because that is what I heard
  • Yes son we are currently at the peak stage of the business cycle. That means that we are at the maximum limit of growth
  • So does that mean that we have a high GDP right now or is it a low GDP?
  • Well son first off GDP stands for Gross Domestic Product. And yes we do have a high GDP and because we have a high GDP we have a low unemployment rate.  
  • Oh ok thanks dad. Ill just have one more question for today ill ask you when we get home
  • What happens when we are not at the peak of the business cycle no more?
  • Well talk about that tomorrow in the morning son.
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