Unit 1; Day 6

Peak- Highest point of real GDP; phase exibits lowest unemployment, greatest amount of spending. Inflation becomes problem

Expansion- AKA recovery; Real GDP Increasing due to increase in spending, decrease in unemployment

Contraction/ Recession- Real GDP declining for 6 months due to reduc. in spending, increase in unemployment

Trough- Lowest point of real GDP; exibits highest amount of unemployment, least amount of spending

Ex.