Business Cycles and Economic Crises

These flashcards cover key concepts related to business cycles, economic crises, and their theories.

Business Cycle

The upward and downward movement of economic activity that occurs around the growth trend.

Recession

A decline in real output (real GDP) that persists for more than two consecutive quarters.

Depression

A particularly severe and prolonged recession.

Trough

The bottom point of a recession or depression.

Expansion

An increase in economic activity following a trough.

Peak

The highest point of economic activity before a decline.

Aggregate Demand (AD) Curve

Shows the quantity of goods and services demanded for any price level.

Aggregate Supply (AS) Curve

Shows how much output producers are willing to supply at any given price level.

Endogenous Theories

Economic theories that attribute fluctuations in the economy to internal factors.

Exogenous Theories

Economic theories that attribute fluctuations in the economy to external shocks.

Keynesian Economics

The theory that recessions and expansions are primarily caused by demand-side shocks.

Classical Economics

The theory that output is determined by supply-side factors.

The Great Depression

The severe worldwide economic crisis that lasted from 1929 until the early 1940s.

Debt Crisis

An inability to repay sovereign or private sector debt.

Balance of Payments (BOP) Crisis

A situation where a country cannot pay for its imports or service its debt.

Asian Financial Crisis

A financial crisis that affected many Asian countries in 1997, characterized by currency devaluations and stock market declines.

Brexit

The United Kingdom's withdrawal from the European Union on January 31, 2020.

European Debt Crisis

A multi-year debt crisis that has affected several Eurozone countries since 2009.

Global Financial Crisis (GFC)

The banking crisis that emerged in 2008, leading to economic recessions worldwide.

COVID-19 Health Crisis

The global health crisis that began in late 2019 and caused significant economic disruption.