1. Bus ine s s
c yc le s
Cindy&Jing

2. What is business cycles ？
• The term business cycle (or
economic cycle) refers to a
phenomenon that a cyclical
economic expansion and
economic contraction cycle in
the economy.

3. What is business cycles ？
• These fluctuations are often measured
using the growth rate of real Gross
Domestic Product (GDP) .
• The business cycles consistent four
stages.

4. Four stages
• S ta g e On e – S ta rt - up / Cre a tio n
• S ta g e Tw o – Gro w th
• S ta g e Thre e – Ma turity
• Fo ur – Re c e s s io n / De c lin e

5. Fo ur s ta g e s

6. Causes of business cycles
• External Causes
• Internal Causes

7. A. sunspot theory
It is said that the
changes of cyclical
naturally sunspots will
affect the cycle of
climate change, which
would affect the
agricultural harvest,
and harvest the
abundance of
agriculture will impact
the whole economy.

8. B. the political cycle theory
• Political cycle theory
thought the business
cycles caused by the
government to the cyclical
nature of the decision-
making (mainly in order to
solve the cycle of inflation
and unemployment).

9. Causes of business cycles
• External Causes
• Internal Causes

10. A. a purely monetary theory
• Pure monetary theory
that the money supply
and monetary flow
directly determines the
fluctuations of the
name of national
income,

11. B. over-investment theory
• Theory of over-
investment thought
the business cycles
caused by excessive
investment.

12. C. under-consumption theory
• The under-consumption
theory thought economic
recession caused by the
demand for consumer
goods can not keep up
with community growth of
consumer goods
production.

13. D. Psychological theory
• The theory thought that the
business cycles depend on
the investment, and
investment size depends
mainly on the owners`
expectations for the future.

14. Cu r e s f o r
t h e b u s i n e s s
c y c l e s
Cu

15. Liquidate labor,
liquidate stocks,
liquidate the
farmers,
liquidate real
estate
Andrew William Mellon (March 24, 1855 – August 27, 1937)

16. America became
officially involved
in World War II.
Did World War II
really end the
Great
Depression,
though?
Wa r II
Wo r ld

17. government
intervention

19. C o n c lu s io n
•External causes
•Internal causes

20. R e fe re n c e s
• Cures for the Great Depression.The Great Depression
Online. From
http://www.greatdepressiononline.com/cures-for-the-great-dep
• Causes and Cures. America’s Great Dpression.
Statistics Retrieved on December 28, 2007 from
http://www.amatecon.com/gd/gdcandc.html
• http://en.wikipedia.org/wiki/Business_cycle
• http://www.buzzle.com/articles/four-stages-of-business-
cycle.html