Analysing the Recent Economic Recession and Its Effects

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The business cycle is the short-run alternation between economic downturns and economic upturns (Investopedia n.d.). A recession is an economic downturn and happens in every country and some recessions are worse than others and the output of GDP and employment are falling farther and faster. The great depression lasted from 1929-1933 and was a deep prolonged downturn in the business cycle before a recovery/expansion of the business cycle occurred and GDP and employment started to rise (Krugman & Wells. 2012). The next recession lasted from 1981-1982 and was comparatively smaller than the first (Krugman & Wells. 2012). More recently in 2001 a slump in the economy was noted and was followed by the great rescission of 2007-2009 (Krugman & Wells. 2012). Recession is defined as a “period of at least two consecutive quarters (a quarter is three months) during which the total output of the economy shrinks” (Krugman & Wells. 2012). In the United States the National Bureau of Economic Research (NBER) is assigning the task of determining when a recession begins and the NBER looks at a variety of economic indicators such as employment and production (Krugman & Wells. 2012). Every business cycle recession has a negative impact on the economy the recession’s deferrer on the strength of the impact on the country. Consider the two charts for Figure 21-5 of the more recent recessions of 2001 and 2007. The Recession of 2001 did not last as long as the recession of 2007 and did not have as much of an economical hardship on the business cycle and as shown 2007 dipped greatly in industrial production. In the second chart it demonstrates a recession at the point the economy turns from expansion to recession or the business-cycle peak. Then in the char... ... middle of paper ... ....). New York, NY: Worth. Pettinger, T. (n.d.). Circular Flow of Income. Economics Help. Retrieved from http://www.economicshelp.org/blog/glossary/circular-flow-income/ PIMENTEL, David (n.d.). PIMENTEL, David. US professor on population growth, Earth's carrying capacity, biofuel, big money & politician ignorance - BIOFUEL GENOCIDE. Retrieved from https://sites.google.com/site/biofuelgenocide/pimentel-david The U.S. Population Situation. (n.d.). World Population Balance. Retrieved from http://www.worldpopulationbalance.org/us_population United States. (n.d.). Data. Retrieved from http://data.worldbank.org/country/united-states U.S. Bureau of Labor Statistics. (n.d.). Employment status of the civilian non-institutional population 25 years and over by educational attainment, sex, race, and Hispanic or Latino ethnicity. Retrieved from http://www.bls.gov/cps/cpsaat07.htm

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