trough

At time t 1 in Figure 20.1 “Phases of the Business Cycle”, an expansion ends and real GDP turns downward. The point at which an expansion ends and a recession begins is called the peak of the business cycle. Real GDP then falls during a period of recession. Eventually it starts upward again (at time t 2).

The working definition of a recession is two consecutive quarters of negative economic growth as measured by a country’s gross domestic product (GDP), although the National Bureau of Economic Research (NBER) does not necessarily need to see this occur to call a recession, and uses more frequently reported monthly data …

The business cycle model shows how a nation’s real GDP fluctuates over time, going through phases as aggregate output increases and decreases. Over the long-run, the business cycle shows a steady increase in potential output in a growing economy.

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.

Typically business cycles are measured by applying a band pass filter to a broad economic indicator such as Real Gross Domestic Production. Business cycles are usually measured by considering the growth rate of real gross domestic product.

The availability of this skill will affect the use of resources and hence the size of the national income.

• Factor # 2. Technical Knowledge:
• Factor # 3. Political Stability:
• Factor # 4. Terms of Trade:
• Factor # 5. Foreign Investment:

Lost Output means the reduction in Qualified Amounts over the relevant measurement period that the Generating Facility was available to produce and could reasonably have been expected to deliver, based upon the calculation method set forth in Exhibit K, but was not delivered due to a Lost Output Event.

Total output can be measured two ways: as the sum of the values of final goods and services produced and as the sum of values added at each stage of production. GDP plus net income received from other countries equals GNP. GNP is the measure of output typically used to compare incomes generated by different economies.

Gross domestic income (GDI) equals the total income generated in an economy by the production of final goods and services during a particular period. It is a flow variable. Because an economy’s total output equals the total income generated in producing that output, GDP = GDI.

output growth rate = (1/3 × capital stock growth rate) + (2/3 × labor hours growth rate)+ (2/3 × human capital growth rate) + technology growth rate. Growth rates can be positive or negative, so we can use this equation to analyze decreases in GDP as well as increases.

Output in economics is the “quantity of goods or services produced in a given time period, by a firm, industry, or country”, whether consumed or used for further production. The concept of national output is essential in the field of macroeconomics.

A positive output gap occurs when actual output is more than full-capacity output. This happens when demand is very high and, to meet that demand, factories and workers operate far above their most efficient capacity. A negative gap means that there is spare capacity, or slack, in the economy due to weak demand.

Output decreases and the price level increases. Output keeps falling and price level keeps rising until real GDP returns to full employment output. As long as output is higher than full employment output, an unemployment rate that is higher than the natural rate will put upward pressure on wages and prices.