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Economic growth

We all know from day-to-day experience that the state of the economy affects our lives. If the economy is booming then jobs are easy to find, house prices are rising and people have increasing amounts of money to spend. On the other hand, in recession many people lose jobs, and may become bankrupt. Even those who are not so badly affected are infected with the general malaise, leading to spending cautiousness and a reduced appetite for risk taking.

Companies are also vulnerable to these ups and downs. When the economy is booming profits tend to rise, they are more inclined to invest and worry less about borrowing and undertaking risky activities. When recession hits, profits tend to fall, and fears of business failure reign. Just ...