What is trade cycle? Explain boom or phase of prosperity
What Is Trade Cycle? Explain Boom Or Phase Of Prosperity.
Be started before reaching the full employment level. Trade Cycle: The trade cycle refers to the ups and down in the level of economic activity which extend over to a period of several years. The trade cycle come in the capitalistic economies. J.M. Keynes says, "A trade cycle is composed of periods of good trade characterized by rising prices and low unemployment percentage, with periods of bad trade characterized by following prices and high unemployment percentages."
Hansen says, "That business cycle is a fluctuation in employment, output and prices".
A cycle has different phases like expansion, recession, contraction and revival. The duration of business cycle may be one year to ten or twelve years. There are four phases of business cycle one of these is boom or phase of prosperity.Boom or Phase of Prosperity: This phase is characterized by high economic activities and increasing production employment, profit, national income, investment, wages and volume of bank credit.
The general mode of business is that of optimism. New plants are setup and old planes are fully utilized. There is great demand of commodities due to increase in income and employment, businessmen earn high profit and standard of living is high but after some time, the boom should reach full employment level.
Hansen says, "That business cycle is a fluctuation in employment, output and prices".
A cycle has different phases like expansion, recession, contraction and revival. The duration of business cycle may be one year to ten or twelve years. There are four phases of business cycle one of these is boom or phase of prosperity.Boom or Phase of Prosperity: This phase is characterized by high economic activities and increasing production employment, profit, national income, investment, wages and volume of bank credit.
The general mode of business is that of optimism. New plants are setup and old planes are fully utilized. There is great demand of commodities due to increase in income and employment, businessmen earn high profit and standard of living is high but after some time, the boom should reach full employment level.
Business cycle or trade is a part of the capitalist system. It refers to the phenomenon of cyclical booms and depressions. In a business cycle there are wave-like fluctuations in aggregate employment, income output and price level. The term business cycle has been defined in various ways by different economists. Professor Haberler’s definition is very simple when he says, “The business cycle in the general sense may be defined as alternation of periods of prosperity and depression of good and bad trade.” Keynes’s definition in his Treatise of money is more explicit: “a trade cycle is composed of periods of good trade charactertised by rising prices and low unemployment percentages, altering with periods of bad trade characterised by failing prices and high unemployment percentages.”
Explain detail of trade cycle
Business cycle are just the name of prosperity and adversity good trade and bad trade
