Hey friends! I shall share with you today a topic of economics called trade cycle.
What a trade cycle is?
A trade cycle is an interval of alternating periods of prosperity and depression. It's the dynamic phases of market; one with economic activities at its peak and another with the bear market.
There are 4 phases of trade cycle:
- Boom: The period with economic activities at its peak.
- Recession: The period where economy start falling gradually.
- Depression: The period where economy is at its lowest position.
- Recovery: The government and changes play a role to recover the economy. Economy starts rising at this stage.
Conclusion:
Every economy goes through these 4 phases and development and growth takes place.
Note: Now is the period of depression everywhere because of trade war between America and China.