The term business cycle, or economic cycle, describes the pattern of expanding and contracting business activity that an economy exhibits over a period of time. In this context, increasing production and consumption are generally referred to as economic growth, and declining production and consumption are usually called economic contraction. What are the phases of a business cycle? Which of the following statements accurately describe the phases of a business cycle? Check all that apply. D A trough occurs at the end of the contraction phase and the beginning of the expansion phase. A peak level of business activity occurs at the end of the expansion phase and the beginning of the contraction phase. A contraction phase is when an economy exhibits increasing quantities of production and spending. A contraction phase is when an economy exhibits decreasing levels of production and consumption. O D A contraction period is characterized by the following attributes: businesses that are operating with levels of production activity, increasing unemployment, retail sales, increasing or high prices and interest rates, a stock market, and expectations of lower business profits. Expansion periods tend to end with a , whereas contraction periods end with a peak trough How do the phases of the business cycle affect your personal financial planning activities? Think about the characteristics of the expansion and contraction periods in a business cycle. How might the characteristics of these two phases affect your efforts to manage your financial resources? Check all that apply. I During a period of economic expansion, it is generally more difficult to make large-ticket purchases due to the greater likelihood of being unemployed. During the early stage of an economic expansion, finding a job generally tends to be easier, because manufacturers and retailers generate relatively higher levels of production and output