Four phases of trade cycle


Expansion  :  This is the main and important phase in business.  Under this phase  a business man can gain more profit.  Hence it can be called profitable  economic conditions.

Contraction :  Contraction is the condition of business in which  the economic conditions falls down quickly.

Peak Or Boom Condition:   This phase indicate the top level profitable economic condition of the business.  After reach at this point (level) a business man feel much relief.   As per the diagram given above Recession is that phase or condition which indicates the profitable condition but it is hint for beginning of contraction condition.

Revival :  This is the very low point condition of business it can be called the depression and recovery situation also.

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