Expansion

Recession

Depression

Recovery

The part of the business cycle in which the economy starts to expand again. After this point the business cycle restarts

The business cycle

Also called prosperity, when there is an expansion of output, income, employment, prices, and profits. Also in expansions the standard of living is high

When economic activity slows down. The unemployment causes a sharp decline in income and aggregate demand. The expansion of businesses stop and the stock market starts to fall

A continuous downfall of output, income, employment, prices, and profit. The economic activity is at its lowest in this point.