Business Cycle Flashcards
1
Q
What is GDP
A
A measure of all the G/S sold within a country
2
Q
What is business cycle
A
Shows the fluctuations in GDP overtime
Illustrates peaks and troughs as well as upswings and down turns
3
Q
What happens to GDP in a recession
A
Low - this means that less products are being produced. Leads to employees not being required so unemployment rises
4
Q
What happens to GDP in a boom
A
High - unemployment is low as lots of products are required, inflation is high
5
Q
How can the government control the cycle
A
By increasing taxes. This means inflation is controlled
