| A | B |
|---|
| business cycle | a period of macroeconomic expansion followed by a period of contraction |
| expansion | a period of economic growth as measured by a rise in real GDP |
| economic growth | steady, long-increase in real GDP |
| peak | the height of an economic expansion, when real GDP stops rising |
| contraction | a period of economic decline marked by falling real GDP |
| trough | the lowest point in an economic contraction, when real gross domestic product stops falling |
| recession | a prolonged economic contraction |
| depression | a recession that is especially long and severe |
| stagflation | a decline in real GDP combined with a rise in the price level |
| leading indicators | key economic variables that economists use to predict a new phase of the business cycle |
| real GDP per capita | gross domestic product expressed in constant, or, unchanging, prices |
| capital deepening | process of increasing the amount of capital per worker |
| saving | income not used for consumption |
| savings rate | the proportion of disposable income that is saved |
| technological progress | an increase in efficiency gained by producing more output without using more inputs |
