ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Peak: During the expansion phase, the GDP spikes to its highest level; this is considered the economy’s peak.

Detailed explanation-2: -The GDP is highest when the economy is at a peak. The GDP is second-highest in the expansion phase as this is the growing period where the economy tries to reach its peak. The recession comes third in the order because, during a recession, the GDP starts declining and becomes very low.

Detailed explanation-3: -A peak is the highest point between the end of an economic expansion and the start of a contraction in a business cycle. The peak of the cycle refers to the last month before several key economic indicators, such as employment and new housing starts, begin to fall.

Detailed explanation-4: -In a business cycle, a peak is the highest point that occurs between the close of an economic boom and the beginning of a downturn. The final month before numerous important economic indicators, such as employment and new housing starts, start to decline, is referred to be the cycle’s peak.