What Component of GDP Is Particularly Volatile Over the Business

question 110

Short Answer

What component of GDP is particularly volatile over the business cycle and can be targeted by tax cuts?

---

Definitions:

Credit Policy

A credit policy is a set of guidelines that a company follows to determine the credit terms for customers, including payment terms, interest rates, and the criteria for extending credit.

All-Cash Policy

A business strategy in which transactions are conducted exclusively with cash, avoiding the use of credit.

Credit Period

The time frame allowed by a seller to a buyer to pay for goods or services received, usually expressed in days.

Operating Cycle

The duration of time it takes for a company to buy inventory, sell it, and convert the sale back into cash. It reflects the efficiency of a company's inventory management and sales processes.