Question

In this discussion forum explain the sensitivity of your company/industry to business cycles; whether it lags or leads the cycle; and if moves with or opposite to the cycle.

Answer 1

• lets suppose we have been dealing with a hypothetical company A ltd. which generally deals with FMCG(fast moving consumer goods) sector.it is a crucial part of the economy.
• it deals with the essential and normal goods and items.most of its product and contents have inelastic demand.
• which means if there is change in price of the commodity thus there would be significant impact on the quantity demanded.

the company and the business cycle.

considering the overall economy A ltd. is the main sector of the economy which is a tool for development and mechanism to pull out the economy from the recession point of view.it means when the business cycle is in recession phase then FMCG sector is less impacted and tries to make the economy neutral.

FMCG sector/industry is the most stable sector in the economy.generally it favors the business cycle but in upward trend or to the maintenance of neutral level.because even in the recession period people would demand essential good irrespective of price upto a certain limit.