According to Investopedia, an economic cycle is the overall state of the economy as it goes through four stages in a cyclical pattern.
The four stages of the cycle are expansion, peak, contraction, and trough.
Factors such as GDP, interest rates, total employment, and consumer spending, can help determine the current stage of the economic cycle.
Insight into economic cycles can be very useful for businesses and investors.
The exact causes of a cycle are highly debated among the different schools of economics.
U.S. economic cycles have lasted about five and a half years on average since the 1950s.
However, there is wide variation in the length of cycles, ranging from just 18 months during the peak-to-peak cycle in 1981 to 1982 up to the expansion that began in 2009.
Source: Finance Jane.
