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Module Two Lesson One Activity

Economics and Personal Finance

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92 views2 pages

Module Two Lesson One Activity

Economics and Personal Finance

Uploaded by

sadiesroberts
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Module Two Lesson One Activity

Article Link:
https://www.nytimes.com/2024/04/11/business/economy/business-cycle.ht
ml
Definitions:
Economic growth- state of economic expansion characterized by
increasing GDP and low unemployment.
Business cycle- regular fluctuations of the economy between periods of
growth and decline.
Unemployment rate- percentage of people looking for full time employment
but cannot find jobs.
Recession- economic condition that is the result of 6 months of declining
GDP.
Gross domestic product- the value of goods and services produced by a
country in a given year.
Federal Reserve Bank- the national bank charged with controlling the
supply of money available in the United States.

Article Summary:
This article is about how the traditional business cycle may be
changing. The author of the article is Talmon Joseph Smith. He talks about
how economists like Rick Rieder of BlackRock believe that the U.S.
economy may no longer follow the same volatile patterns due to a shift
towards a more stable economic orbit, with more consistent momentum. He
also brings up the fact that consumption spending makes up a significant
portion of the economy and remains relatively stable to help to avoid
recessions. Historically, economic cycles have been characterized by
periods of growth followed by contractions, leading to bankruptcies and
unemployment. Factors such as improved banking regulations and global
trade are contributing to longer periods of economic growth. However,
some economists, like Thomas Herndon, caution that underlying
vulnerabilities, such as labor power dynamics and credit cycles, could still
pose risks. The Federal Reserve's innovative strategies may help mitigate
these risks, but the unpredictability of economic downturns remains a
challenge. The recent shift in economic dynamics, such as the decline in
the housing sector and the resilience of e-commerce during the pandemic,
indicate a departure from traditional economic patterns. While some
analysts compare the U.S. economy to the global economy in terms of
resilience, past events like the global financial crisis and the Covid-19
pandemic serve as reminders that unexpected shocks can disrupt even the
most stable economies. The idea of an everlasting economic expansion
remains elusive, with the possibility of recessions always looming.

Significance:
This article was printed in the newspaper because it has a lot of good
information about the economy and the business cycle. He also provides
statistics which make him more credible than other sources. He uses this
statistic to prove that he knows what he is talking about “According to the
National Bureau of Economic Research, the U.S. economy between the
1850s and the early 1980s experienced 30 recessions lasting an average
of 18 months, with intervening periods of economic growth averaging only
33 months.” He makes note of the evolving business environment and is
prompting a reevaluation of long-held economic theories. As the business
cycle continues to evolve, experts are closely monitoring these shifts to
better understand and adapt to the changing economic landscape this
shows that he also provides ways to help the economy.

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