Download Business Cycle PP

Survey
yes no Was this document useful for you?
   Thank you for your participation!

* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project

Document related concepts
no text concepts found
Transcript
The Business Cycle
COUNTERPOINTS PG. 90, STUDENT
WORKBOOK PG.77-78
SOCIAL STUDIES 11
What is Capitalism?
An economic system where private individuals or
corporations own the means of production and
distribution.
 The goal of capitalism is to make money.
 Production = supply and demand
 Prices = supply and demand
What is Capitalism?
At the beginning of the 20th century, capitalism was
very different from today.
 Most governments carried out lassiez faire
economic policies.
 This means that the government did not interfere
with the economy.
In the late 1920’s, a shift occurred because
governments had to exercise more control over
economic matters.
Business Cycle (Economic Cycle)
Capitalism is characterized by a series of booms and
busts called the business cycle.
A.
Letter A represents a decline, sometimes called a
recession or bust.
 During a decline, consumer spending decreases
and investors become cautious about the future.
 As a result, factories slow production and lay off
workers.
 The increased unemployment leads to reduced
spending, further contributing to the economy’s
decline.
B.
Letter B represents the lowest point of a recession.
 This is a period of high unemployment and low
prices.
 The prices drop because there is less money being
circulated in the economy.
 The bust, or recession, tends to not last for a long
period of time.
C.
Letter C represents a boom, or prosperity. A boom
is a period of prosperity.
 During this time, most people have jobs, and are able
to buy goods and services.
 This keeps the economy strong.
 During this time, there is the highest levels of
inflation as producers try to slowly increase their
prices in order to get a bigger share of the thriving
market.
D.
Letter D represents a depression.
 A depression is a very big decline whereas a
recession is only a small decline.
 During a depression, unemployment is very high
and there is little money circulating in the
marketplace. This is very serious for a country.
E.
Letter E represents a recovery.
 During a recovery, the economy is improving.
 When people have more money, they start
spending more, and producers are encouraged to
increase production.
 This means there are more jobs, and, in turn, even
more spending.
Business Cycle (Economic Cycle)
Turn to your neighbour and explain what A,B,C,D,E
represent on the Business Cycle chart?