Question

In: Economics

Business cycles are pervasive in all macroeconomics variables. Does the relative duration of expansions and recessions...

Business cycles are pervasive in all macroeconomics variables. Does the relative duration of expansions and recessions help explain the fact that long term economic growth has been positive.

Solutions

Expert Solution

. Business cycles are pervasive in all macroeconomic variables; it means that the existence of a Business Cycle is applicable in all types of macroeconomic variables in the economy.
Business cycle means the circle of ups and downs in the business and the various conditions which affect the business in the organisation.
In this case the word pervasive means applicable everywhere and it is true that business cycle is applicable everywhere in the macroeconomic variables whether it is a matter of national income or it is a matter of determination of income and employment and the matter of government budget and the Money and banking.
The relative duration of expansions and receptions help in the existence of business cycles because the expansion in the economy means the growth of all the sectors in the economy and recession is a situation where all the activities basically productive activities are slowed down up to a particular down point.
The long-term economic growth has been positive if there is systematic economic planning in the economy and falls the macroeconomic variables or under a productive situation.
The long-term economic growth is a symbol of continuing working on the concept of efficiency in all the sectors.


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