Macroeconomics - Economic Fluctuations and Business Cycles
10 important questions on Macroeconomics - Economic Fluctuations and Business Cycles
What are economic fluctuations or business cycles?
Short-run changes in the growth rate of real GDP
What are periods of negative growth in GDP?
What are economic expansions?
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What are 3 key properties of economic fluctuations?
2) Limited Predictability in Turning Points
3) Persistence in the Growth Rate
Explain the first key property of economic fluctuations: What is Co-movement?
What is an example of a co-movement?
Explanation: When consumption growth is high, investment growth tends to be high as well.
Explain the second key property of economic fluctuations: What is Limited Predictability of Turning Points ?
What is an example of a negative co-movement?
If unemployment is high, GDP tends to fall
Explain the third key property of economic fluctuations: What is Persistence in the Rate of Growth?
if not: turning point
What is a recession?
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