#53- Describe the phases of the business cycle
#54- Explain the concept of gross domestic product
#55- Explain productivity and its effects on
individual businesses and the economy as a whole
Recurring changes in economic activity
 History shows that sometimes an
economy grows (expansion) and
sometimes is slows down )contraction)
 Economies have followed the patterns
 Sometimes called “Economic Cycle”
 Four patterns: Expansion, Recession,
Trough-Depression, Recovery
Recovery
Expansion
Recession
Trough
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Economy is flourishing
Sometimes referred to as “prosperity”
Nationwide low unemployment
Increase in output of goods and services
High consumer spending
Good time for new businesses to start
up/expand
Expansions continues until it reaches a “Peak”
“Peak” ends expansion and begins “recession”
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Period of economic slow down
Lasts for at least two quarters (or 6 months)
Businesses reduce work force
Consumers have less money to spend
Producers make fewer goods and services
Research and development is cut back/
business expansion put on hold
Can end quickly or last a long time
End is signified by “trough”- lowest point in
the recession
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Lowest point in business cycle
Marks transition from recession to recovery
period
Economy stops slowing and shows signs that
recovery is near
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Prolonged recession
Nearly impossible to
find a job
Businesses shut down
Spending is very low
Unemployment very
high
Poverty results from
high unemployment
Great Depression of
1930’s is example
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Period of renewed economic growth
Follows recession or depression
GDP begins to increase
Business picks up
People are finding jobs
Increased consumer spending
Moderate expansion by businesses
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Work with a partner to complete this class
activity.
Create a chart that compares and contrasts the
4 phases of the business cycle.
Then, identify the phase that you think the
United States currently is experiencing and
justify your answer.
E-mail to mbelote@lcps.org for 50 point
assignment
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Standard of Living- The level of wealth, comfort,
material goods and necessities available to a certain
socioeconomic class in a certain geographic area
Inflation- Sustained increase in the general price level
of goods and services in an economy over a period of
time
Unemployment Rate- The percentage of the total labor
force that is unemployed but actively seeking employment
and willing to work
GDP- output of goods and services produced by labor
and property within a country over a specified period
of time
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Gross Domestic Product
Output of goods and services
produced by labor and property
located within a country
Indicator of economic health of a
country
Serves as measure of county’s
productivity
Used as gauge of country’s standard of
living
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Output per worker hourmeasured over a defined period
of time
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Business investment in new equipment
or facilities
Additional training
Financial Incentives
Reduce work force and increase
responsibilities of other workers who
remain
Higher productivity improves company
profits
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Business Cycle
Expansion
Recession
Trough
Depression
Recovery
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Economic Indicator
GDP
Standard of Living
Productivity
Ways to Increase
Productivity
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Students will work independently or with a partner to
complete this assignment
Select a company and research how that business has
increased productivity over recent years.
Prepare a breif PPT presentation to deliver to the class that
outlines the following:
100 Points
Company Overview
Strategies Used to Increase Productivity
Investment Required by the Company
Results and Impact on the Company
Summary/Conclusion