Unit 2


	Downturn period - the boom slows and the rate of growth decreases
	Advantages Increase in prices and costs begin to slow and they may begin to fall Inflation may ease	Disadvantages Sales of income elastic goods will fall Sales of other goods begin to rise and consumers feel less confident and may reduce spending Output slows and may fall Investment slows as expectations of growth diminish
	Evaluation Downturn is bad for the economy as unemployment is increasing, output and incomes are static,base rate is falling and GDP% is slowing.

Sales of income elastic goods will fall
Sales of other goods begin to rise and consumers feel less confident and may reduce spending
Output slows and may fall
Investment slows as expectations of growth diminish

Downturn is bad for the economy as unemployment is increasing, output and incomes are static,base rate is falling and GDP% is slowing.

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