The Business Cycle pt.2

The Business Cycle pt.2

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  • Oh its morning I am going to go ask the question again from last night.
  • Good morning son did you sleep well?
  • Yes dad. I was wondering what comes after prosperity?
  • The thing that comes after prosperity is recession which is when we go down in the business cycle.
  • Well why did it go down all of sudden we were just at the top 
  • Well when recession happens that usually means that demand for goods and services are going down and the we usually don't notice it 
  • Does that mean that we cannot come back from this?
  • Well son after that there are two more stages and the next one is called depression. Depression is when the unemployment rate starts to rise because businesses aren't higher anyone because they arent making a lot of profit.
  • Alright and what is the other stage?
  • The other stage of the business cycle is recovery. Recovery is when we start to recover from the negative growth rate. Employment begins to rise again and demand begins to pick up due to the low prices 
  • Thanks dad now I know
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