Final dates! Join the tutor2u subject teams in London for a day of exam technique and revision at the cinema. Learn more

Quizzes & Activities

Economic Cycle (Quizlet Revision Activity)

A-Level, IB
AQA, Edexcel, OCR, IB, Eduqas, WJEC

Last updated 15 Feb 2019

Here is a Quizlet revision activity covering key terms relating to the economic cycle.

Gross domestic product (GDP) year-on-year growth in the United Kingdom (UK) from 2000 to 2018

Key term summary for revision

Accelerator effect

When investment is linked positively to expected growth of consumer demand

Animal spirits

State of confidence or pessimism held by consumers and businesses

Credit crunch

When the commercial banks restrict their lending to businesses and households

Cyclical unemployment

A rise in the jobless rate caused by a contraction of aggregate demand


A prolonged slump leading to a decline in real GDP of at least 10 percent

Double dip recession

When an economy contracts twice without a full recovery in between

Economic boom

Rapid growth of real GDP that takes an economy above trend.

Economic shocks

Unpredictable events such as volatile prices for oil, gas and foodstuffs.

Fine tuning

Changes in economic policy designed to gradually influence demand, output and prices


A prediction made about the likely future performance of an economy


Stocks of finished products and components

Output gap

The difference between real GDP and potential GDP


The high point of the economic cycle beyond which a recession starts

Real disposable income

Income after taxes and benefits adjusted for inflation


Contraction in economic activity lasting at least six months


A fall in the rate of growth but not a full-scale recession


An objective of government policy e.g. low inflation or rising employment


Implies choices have to be made between different objectives e.g. prices and jobs

Trend growth

Long term average growth of real GDP


The low point of the cycle beyond which a recovery starts

© 2002-2024 Tutor2u Limited. Company Reg no: 04489574. VAT reg no 816865400.