The Business Cycle (Economic Activity) – GCSE Business Studies Revision

This revision content is also featured in this video on my YouTube channel!

(I give my YouTube channel permission to monetize the revision content)

The Business Cycle:

1: Growth

  • Economic growth is a rise in economic activity
  • This makes people better off, and jobs are more secure
  • People are less afraid to buy things and buy things on credit
  • Booming is when an economy is growing very fast (much faster than usual)

2: Downturn

  • Economic activity starts to decrease
  • Customers are more cautious about buying things and borrowing money
  • Businesses are more careful about their cash flow

3: Recession

  • If the slow in economic activity is severe, the economy can start to get smaller
  • Recession is when there is negative economic growth and a decrease in sales and production in the economy
  • This makes it difficult for businesses to survive in this economic downturn
  • Sales fall so businesses cut jobs to reduce costs
  • The danger of unemployment and lack of job security makes people more afraid to spend money

4: Recovery

  • This is when the economy stops shrinking and starts to grow again
  • Recovery can take a long time
  • Customers’ confidence starts to increase again
  • The cycle loops back to stage 1: Growth

About Matt

I like writing, filmmaking, programming and gaming, and prefer creating media to consuming it. On the topic of consumption, I'm also a big fan of eating.
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