EXPANSION: A phase of the business cycle characterized by a general period of rising economic activity. An expansion is one of two basic business cycle phases. The other is contraction. The transition from expansion to contraction is termed a peak and the transition from contraction to expansion is termed a trough. Expansions last an average of about 3-4 years, but this by no means not guaranteed. An expansion in the early 1980s lasted a mere 12 months. The next expansion then lasted over 8 years. Much of the 1960s was dedicated to a 106-month expansion, almost 9 years.

     See also | business cycle | prosperity | contraction | peak | trough | real gross domestic product | full employment | unemployment rate | inflation | investment | consumption | investment business cycle | political business cycle |

EXPANSION, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2023. [Accessed: September 30, 2023].

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The state of equilibrium that exists in the long-run aggregate market when real aggregate expenditures are equal to full-employment real production with no imbalances to induce changes in the price level or real production. The opposing forces of aggregate demand (the buyers) and long-run aggregate supply (the sellers) exactly offset each other. At the existing price level, the four macroeconomic sectors (household, business, government, and foreign) purchase all of the real production that they seek and producers sell all of the real production that they have.

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