Person 1

Gross Domestic Product is not the perfect measure of economic well being but it is the best statistic that we have. Gross Domestic Product, also known as GDP, measures the monetary value of all goods and services produced in the country within a specific amount of time. The higher the GDP, the better the country is performing. Unfortunately, there are activities that create income but do not increase the “well being” of this country. For example, companies investing in oil can raise the GDP but this is harming the environment. GDP can also rise during a war or a terrorist attack as well. Crime is another example because money is spent for legal fees, medical bills, and housing in prison. Unfortunately, positive action can also lower the GDP in the United States. Laws that restrict pollution can actually lower the GDP, even though this is actually benefiting the world. Although Gross Domestic Product doesn’t measure the economic well being, it is our best statistic because it measures the size, growth, and the performance of the country. The growth of the GDP often shows how healthy the economy is. In conclusion, although the GDP is rising, this doesn’t mean that it’s illustrating a successful economy that’s promoting good intentions.

Person 2

The four phases of the business or economic cycle are trough (crisis) expansion (recovery) peak (boom) and the contraction (depression). During the expansion or recovery phase, the overall economy grows. There is an increase of employment, money circulates, interest rates lowers and consumer confidence strengthens. The peak phase or the boom would be the richest point an economy can reach. After this point, the contraction or depression phase would come. During this phase, economy begins to fall. There is an increase of unemployment, money circulation halts, interest rate increases, consumer confidence lowers, and inflation occurs. It is the opposite of the expansion phase. The economy continues to decline until it reaches the through which is the lowest point an economy can reach. The Great Depression is a great example of the outcomes for this period. This cycle repeats throughout all economies and the intersection intervals between each phase could last seconds, minutes, hours, days, months, or years, there is not really a fixed time for each phase’s transition. As for which phase are we currently in, I believe we’re on a recession period which means we would be in the contraction or depression phase in the economy cycle. This is mainly due to the recent pandemic where people were not producing items (labor) yet the government administered money packages to enable families buy their daily necessities. I’m not sure when we would move on to the next phase, but we must be prepared when that time arrives.