A recession in the business cycle represents a decline in economic activity, starting at the peak and transitioning back to an expansion.
In the context of the business cycle, a period of declining GDP is referred to as a recession, which marks a downturn in economic activity. The point at which an expansion ends and a recession begins is known as the peak of the business cycle. Real GDP falls during a recession but eventually starts to increase again, marking the transition from recession to an expansion.
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