ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Recession and unemployment go hand in hand-a spike in unemployment and its persistence are hallmarks of a recession, and joblessness in turn aggravates recessions. The short-term and long-term costs of unemployment have led governments to develop a range of policy measures aimed at curbing joblessness during downturns.

Detailed explanation-2: -Key Takeaways The business cycle goes through four major phases: expansion, peak, contraction, and trough. All economies go through this cycle, though the length and intensity of each phase varies.

Detailed explanation-3: -The upswing of the business cycle towards a peak is called an economic expansion. An economic expansion is associated with: increase in production/output • decrease in unemployment • increase in wages • increase in consumer spending.

Detailed explanation-4: -Expansion is the phase of the business cycle where real gross domestic product (GDP) grows for two or more consecutive quarters, moving from a trough to a peak. Expansion is typically accompanied by a rise in employment, consumer confidence, and equity markets and is also referred to as an economic recovery.