ECN 204 Chapter 9: Chapter 9 ECN 204
86 views4 pages
8 Feb 2017
School
Department
Course
Professor
Document Summary
Business cycle: refers to alternating increas es and dec reas es in the level of economic activity. Peak: business activity has reached a temporary maximum. Recession: a period of decline in total output, income and employment. Trough: of the recession or depression, output and employment bottom out at their lowest levels. Expansion: a period in which real gdp, income and employment rise. Monetary factors ( more money or less money being printed) Political events: like peace treaties, new wars or terrorist attacks. Financial instability: boom (assets price increase) or busts (asses decreases) Capital goods: housing, equipment, farm implements (affect most in business cycle) Consumer durables: automobiles and refrigerators (affect most in business cycle) Nondurable consumer: goods affected less like services (law firms), clothing and food. Frictional unemployment: a type of unemployment caused by workers voluntarily changing jobs and by temporary layoffs; unemployed workers between jobs.