Chapter 6
The Business Cycle and Economic Indicators
In This Chapter
• Why the business cycle occurs
• Fiscal and monetary policy and what they do
• Where to find economic indicators
• What economic indicators mean to you
Although we would all like the economy to grow constantly, it goes through expansions and contractions and periods of rapid and sluggish growth. Cycles of expansion and contraction, or recovery and recession, are called the economic cycle, or the business cycle. (Sluggish growth is just called sluggish growth.)
The business cycle affects business decisions because in times of economic growth businesses want to expand, so they invest more, hire more workers, and produce more. Businesses also want to expand in times of recession ...
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