Analyzing Economic Cycles, Government Policy, and the Dot-Com Bubble

This essay provides an overview of economic cycles, detailing the phases of expansion and contraction, and the factors influencing them such as GDP, employment, and interest rates. It examines how government policies, both fiscal and monetary, impact these cycles, particularly in stimulating economic expansion through increased spending or tax cuts. The essay then focuses on the dot-com bubble of the late 1990s, analyzing its causes, including the rapid growth and investment in internet-based companies. Finally, it discusses the role of government intervention through monetary and fiscal policies in mitigating the effects of such economic crashes. Desklib offers a wide array of study tools and solved assignments to aid students in their academic pursuits.

0Running hyead: ECONOMICS
Economics
Name of the student
Name of the university
Author note

1ECONOMICS
Table of contents
Answer to the question...............................................................................................................2
Reference list..............................................................................................................................3

2ECONOMICS
Answer to the question
The natural fluctuation which takes place between the expansion period and the
contraction period is termed as the economic cycle. The factors that are known to affect the
economic cycle are gross domestic product, employment level, consumer spending and the
rate of interest. The four phases of business cycle are expansion, contraction, peak and
trough.
The rise in the spending of the government or in some cases the tax cuts is one of the
most common way of increasing the aggregate demand which is known to cause the
economic expansion (Thomas, 2015). The various kind of monetary policies which are
known to be induced by the political pressure will be influencing the business cycle. The
fiscal policies and the monetary policies are known to influence the economic cycles.
The dot com bubble took place in the United States and lasted from 1995 to 2000
where there had been a period of extreme growth along with adoption of the internet. During
that time many online shopping companies have shut down (Menzel, Feldman & Broekel,
2017). The dot com bubble was also known as the internet bubble and the tech bubble. There
had been a huge rise in the United States equity valuations which are known to be fuelled by
the investments in some of the internet based companies (Schubert et al., 2017). The
government will be implementing various monetary and fiscal policies in case of helping the
crashes which took place during dot com bubbles. The government have taken various
measures to save companies during bubbles.

3ECONOMICS
Reference list
Khemka, G., & Roberts, S. (2015). Impact of economic cycles on mortality: the Australian
context. Journal of Population Research, 32(2), 139-155.
Menzel, M. P., Feldman, M. P., & Broekel, T. (2017). Institutional change and network
evolution: explorative and exploitative tie formations of co-inventors during the dot-
com bubble in the Research Triangle region. Regional Studies, 51(8), 1179-1191.
Schubert, W., Gavurová, B., Kováč, V., & Užík, M. (2017). Comparison of Selected Market
Indicators During the Dot-Com Bubble. In Financial Management from an Emerging
Market Perspective. IntechOpen.
Thomas, D. S. (2015). Social Aspects of the Business Cycle (RLE: Business Cycles).
Routledge.