Order your essay today — written by real experts, guaranteed plagiarism-free, and ready to impress your professor!
Business Cycles
The business cycle has four main stages. The first stage is the expansion. The main characteristics of this stage are increased employment and wages, economic activity and upward price pressure.
The second stage is the peak. An economy reaches the peak when its output is the maximum. The main features of an economy at the peak include full employment and an upward price pressure.
The third stage is the contraction. Some of the main characteristics of this stage include slowing growth, increase in unemployment and subsiding price pressure. The fourth stage is the trough. This stage characterizes the lowest point in the business cycle.
It marks the end of the declining business activity. An analysis of the summary of the overall U.S economic activity, employment and ways, and prices, as presented by The Federal Reserve (2017), shows that the U.S economy is in the expansion phase of the business cycle. Several factors illustrate this expansion.
First, the majority of the economic sectors in the U.S are experiencing considerable growth. These sectors include manufacturing, tourism and travel, construction, various non-financial services, and energy.
Another factor that demonstrates that the American economy is expanding is the increase in employment and wages.
Most employers posted increase demand for both high-skilled and low-skilled workers. There has been a significantly strong demand for skilled workers.
The greatest increase in wages is evident among workers with skills that are in high demand. Some of the economic sectors that are experiencing significant worker shortages include the manufacturing and construction sectors.
These two sectors comprise some of the sectors that have experienced considerable economic growth recently.
The other sectors are also expecting modest to moderate labor shortages and increase in wages. The third factor that illustrates that the U.S economy is expanding is the prices.
A modest to moderate price increase often accompanies the economic expansion. The input, retail and home prices in the U.S have increased recently.
