Dear Fellow Students,
After reading the module and additional material as well as
watching videos in session1 , please answer these Questions :
1. What is a Business Cycle?
2. What benefits can a business have when he knows the business
cycle of his business?
3. What month of the year is the best to open a business in your
opinion?
ANSWER:
1. What is the
Business Cycle?
The business cycle is also known as the economic cycle or trade cycle. In simple terms, the business cycle can be interpreted as a series of economic conditions that occur repeatedly, constantly, and regularly in a certain period. Although repetitive, the length of the business cycle cannot be predicted or determined with certainty. The variable used as a measure of the business cycle is the real Gross Domestic Product (GDP) growth rate.
2. What benefits can the business get when it knows the business
cycle of the business?
Actually, business cycle analysis has two main benefits in predicting crises that occur in the economy.
First, business cycle analysis is useful for a relatively accurate early detection process regarding the turning point of macroeconomic conditions, enabling policy makers to formulate preemptive policy measures.
Second, it has been recognized that business cycle analysis can produce relatively precise indicators for making turning point predictions that also include detecting changes in economic regimes.
3. In your opinion, what is the most appropriate month to open a
business?
Actually there is no definite month in the calendar as a reference in starting a new business. In opening a new business, it should not be determined on what day and what month, but it should be more based on the courage to step in when seeing the risks that will lie ahead. Remember, the greater the risk to be faced, the more likely it is to get sustenance.
Of course, the risk must also be calculated properly. You don't want to just believe in good fortune and don't do calculations in advance. There are two types of risk, namely wild risk and calculated risk. An entrepreneur must always calculate the 2nd risk, which is measurable risk. If the risk has been well measured and calculated, then you must be brave to take action.
To avoid risks, prospective entrepreneurs usually start a business when economic conditions in the country are going well. Yes, naturally, because usually when the economy is good, the people's income is in good condition so that many rich people want to turn their money around to make a profit. That's a good opportunity that entrepreneurs should be able to grasp to get moving.
However, what is smarter is to start a business when the country's economic conditions are difficult or uncertain. How come? Because at that time you will get the most difficult lessons in starting a business and behind these difficulties will come various kinds of opportunities that will not be obtained when economic conditions are good.
It's like you are doing your homework and solving one problem at a time. So that when economic conditions improve, your business will be the most prepared compared to others.