Question

Akwasi is considering investing in either Real Estate or Shopping mall, a market survey
revealed the following returns with their respective business cycle which have been
estimated occur evenly during the year.
Business Cycle Returns
Real Estate Shopping mall
Boom 13% 16%
Recession 4% 8%
Normal 12% 14%
Depression -5% 1%
Which one will you advise him to choose and why?

KINDLY ANSWER ASAP
VERY URGENT

Answer 1

Before going to this question we know about the business cycle

this business cycle also known as a economic cycle this economic cycle has 4 stages are expansion, peak, contraction, and trough. in expanison or boom stage the economic experiences rapid growth, in peak level the economic had its over value as compare to value of economy, contraction or recession stage the economy declines rapidly, in trough stage the economy reaches its low value and it recovers with the boom stage this was continues cycle.

From the above case i suggest to choose the shopping mall because

1. Boom or expansion rate compare to the real estate was more in shopping mall. It leads the chance of growth of the investment more compare to real estate.

2. Recession or decling rate was high compare to the real estate but in context of long term the depression rate was very low is means this recession leads shows the investment have long term possibilties.

3. Shopping mall has advanatage compare to the real estate because the normal rate in shopping mall it means the investment stand with less flucation and stable compare to the reral estate

4. In at the last point depression was less compare to the real estate it means the the decling of the investment has slitly less than the other one.