The Boom and Bust Cycle is a pattern of economic expansion and contraction that occurs over time. The cycle is driven by a number of factors, including changes in consumer confidence, business investment, and interest rates.During an expansionary phase, the economy experiences strong growth and low unemployment. This is followed by a period of contraction, during which growth slows and unemployment rises. The cycle then repeats itself.Understanding the Boom and Bust Cycle can help you make better financial decisions and avoid making costly mistakes. For example, during a period of contraction, it may be wise to save more money and invest in less risky assets.
