Suppose the phillips curve is represented by the following equation: πt - πt-1 = 20 - 2ut. given this information, which of the following is most likely to occur if the actual unemployment in any period is equal to 6%? a) the rate of inflation will tend to decreaseb) the rate of inflation will be constantc) the rate of inflation will tend to increasee) none of the above

The business cycle is the periodic but irregular up-and-down movement in economic activity, measured by fluctuations in real gross domestic product (gdp) and other macroeconomic variables. a business cycle is typically characterized by four phases—recession, recovery, growth, and decline—that repeat themselves over time. economists note, however, that complete business cycles vary in length. the duration of business cycles can be anywhere from about two to twelve years, with most cycles averaging six years in length. some business analysts use the business cycle model and terminology to study and explain fluctuations in business inventory and other individual elements of corporate operations. but the term "business cycle" is still primarily associated with larger (industry-wide, regional, national, or even international) business trends.