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In general, the business cycle is said to go through expansion, then the peak, followed by contraction, and then it finally bottoms out with the trough.
Business Cycle (or Trade Cycle) is divided into the following four phases :-. Prosperity Phase : Expansion or Boom or Upswing of economy. Recession Phase : from prosperity to recession (upper turning point). Depression Phase : Contraction or Downswing of economy.