Which phase of the economic cycle is characterized by rising GDP and demand?

The phase characterized by rising GDP and demand is known as a Boom. During this stage of the economic cycle, the economy experiences robust growth, as reflected in increased production, high consumer spending, and overall higher levels of economic activity. Businesses often flourish, investments rise, and employment rates tend to improve as a result of this economic expansion.

The period of a Boom is marked by consumer confidence, which encourages spending and investment. Such conditions can lead to higher prices due to increased demand for goods and services. Additionally, this phase is important in understanding how economies function, as it can directly influence monetary policies and business strategies.

In contrast, other phases do not exhibit these characteristics. A Recession involves a decline in GDP and can lead to reduced demand, while a Depression typically presents severe economic downturns and prolonged periods of high unemployment. Therefore, the Boom phase stands out for its defining features of rising GDP and demand.