External Causes:
The External causes or exogenous factors which may lead to boom or bust are:
Wars:
Wars:
During war times, production of war goods, like weapons and arms etc., increases and most of the resources of the country are diverted for their production. This auects the production of other goods - capital and consumer goods. Fall in production causes fall in income, profits and employment. This creates contraction in economic activity and may trigger downturn in business cycle.
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