Definition
A contraction is a period of economic decline characterized by reduced business activity, lower consumer spending, and negative GDP growth. It is a key phase of the business cycle.
Related Services
Economic forecasting, risk management, and financial consulting services help businesses navigate contractions by adjusting budgets, managing cash flow, and identifying cost-saving opportunities.
Problem and Application
During economic contractions, companies may experience lower revenues, higher unemployment, and reduced investment. Businesses must adapt by optimizing costs and maintaining financial stability.
Conclusion
Understanding economic contractions allows businesses to prepare for downturns, implement strategic adjustments, and position themselves for recovery and long-term resilience.
