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A business cycle measures the fluctuations in economic activity over time, typically characterized by periods of expansion and contraction. It encompasses four main phases: expansion, peak, contraction (or recession), and trough. These cycles reflect changes in indicators such as GDP, employment, and industrial production, helping economists and policymakers assess the health of the economy and make informed decisions. Understanding the business cycle is crucial for predicting future economic trends and implementing appropriate fiscal or monetary policies.

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