Can You Explain The Different Phases Of A Business Cycle?

A business cycle is also known as economic cycle and it shows the fluctuations in the economic activities of a business. There are four phases of a typical business cycle which include Peak, Recession, Trough and Recovery. There are different characteristics of each phase. When the growth of a business starts, it leads to the peak which is the phase where the activity of the business is at the highest level. After this phase, business is more prone to go under recession because peak is the maturity phase in the business cycle and if a business is unable to introduce innovations then recession comes. In the trough phase again the position of the business continues and a decline stage comes and if the business is not able to develop and survive then fourth phase or Recovery phase comes.

Phases of business cycle