In economic theory, a “hurdle rate” is the minimum return that a person requires before he or she will make an investment. a research report says that annual returns from a specific class of common equities are distributed according to a normal distribution with a mean of 12% and a standard deviation of 18%. a stock screener would like to identify a hurdle rate such that only 1 in 20 equities is above that value.

The business cycle is the periodic but irregular up-and-down movement in economic activity, measured by fluctuations in real gross domestic product (gdp) and other macroeconomic variables. a business cycle is typically characterized by four phases—recession, recovery, growth, and decline—that repeat themselves over time. economists note, however, that complete business cycles vary in length. the duration of business cycles can be anywhere from about two to twelve years, with most cycles averaging six years in length. some business analysts use the business cycle model and terminology to study and explain fluctuations in business inventory and other individual elements of corporate operations. but the term "business cycle" is still primarily associated with larger (industry-wide, regional, national, or even international) business trends.