2. Economic fluctuations and growthThe following table shows data on a hypothetical country's real GDP from 1980 through 1988:Year198019811982198319841985198619871988REAL GDP (Billions of dollars)220216The green line on the following graph shows the economy's long-term growth trend.212Use the blue points (circle symbol) to plot the real GDP in each of the years listed. (Note: Plot your points in the order in which you would like themconnected. Line segments will connect the points automatically.) Next, place the black point (plus symbol) on the graph to indicate the point on thereal GDP curve that definitely represents a peak. Finally, place the grey point (star symbol) on the graph to indicate the point on the real GDP curvethat definitely represents a trough.208204200196192188Real GDP(Billions of Dollars)188184190180194204202198196200206Long-term growth trend1980 1981 1982 1983 1984 1985 1986 1987 1988YEARoReal GDPPeakTrough Calculate the percentage change in real GDP in each of the years shown. (Hint: The percentage change in real GDP equals the change in GDP fromthe previous year to the current year. For example, you can calculate the percentage change for 1981 by finding the change in GDP from 1980 to1981, dividing this change by the level of GDP in 1980, and then multiplying the result by 100.)Once you've calculated the percentage change for each of the years, use the orange points (square symbol) to plot your results on the followinggraph, rounded to the nearest percent. For each year, plot the percentage change from the year before. (Hint: For example, you should plot thegrowth rate from 1980 to 1981 with a horizontal coordinate of 1981.)ANNUAL CHANGE IN REAL GDP (Percent)5-519811982 1983True1984O False19851986YEARThis economy experienced a contraction in the yearswhich the level of real GDPseen as a period in which the growth rate of real GDP1987True or False: This economy was experiencing a contraction in 1981.19880Annual ChangeOn the first graph (showing real GDP), this contraction is seen as a period inOn the second graph (showing annual change in real GDP), this contraction is

Annual real GDP growth refers to the percentage increase in a country's Gross Domestic Product (GDP)…

2. Economic fluctuations and growth The following table shows data on a hypothetical country's real GDP from 1980 through 1988: Year 1980 1981 1982 1983 1984 1985 1986 1987 1988 REAL GDP (Billions of dollars) The green line on the following graph shows the economy's long-term growth trend. 220 Use the blue points (circle symbol) to plot the real GDP in each of the years listed. (Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.) Next, place the black point (plus symbol) on the graph to indicate the point on the real GDP curve that definitely represents a peak. Finally, place the grey point (star symbol) on the graph to indicate the point on the real GDP curve that definitely represents a trough. 216 212 208 204 200 196 192 188 Real GDP (Billions of Dollars) 188 190 194 204 202 198 184 196 200 180 206 Long-term growth trend 1980 1981 1982 1983 1984 1985 1986 1987 1988 YEAR 。 Real GDP Peak Trough ?

2. Economic fluctuations and growth The following table shows data on a hypothetical country's real GDP from 1980 through 1988: Year 1980 1981 1982 1983 1984 1985 1986 1987 1988 REAL GDP (Billions of dollars) The green line on the following graph shows the economy's long-term growth trend. 220 Use the blue points (circle symbol) to plot the real GDP in each of the years listed. (Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.) Next, place the black point (plus symbol) on the graph to indicate the point on the real GDP curve that definitely represents a peak. Finally, place the grey point (star symbol) on the graph to indicate the point on the real GDP curve that definitely represents a trough. 216 212 208 204 200 196 192 188 Real GDP (Billions of Dollars) 188 190 194 204 202 198 184 196 200 180 206 Long-term growth trend 1980 1981 1982 1983 1984 1985 1986 1987 1988 YEAR 。 Real GDP Peak Trough ?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

2. Economic fluctuations and growth
The following table shows data on a hypothetical country's real GDP from 1980 through 1988:
Year
1980
1981
1982
1983
1984
1985
1986
1987
1988
REAL GDP (Billions of dollars)
220
216
The green line on the following graph shows the economy's long-term growth trend.
212
Use the blue points (circle symbol) to plot the real GDP in each of the years listed. (Note: Plot your points in the order in which you would like them
connected. Line segments will connect the points automatically.) Next, place the black point (plus symbol) on the graph to indicate the point on the
real GDP curve that definitely represents a peak. Finally, place the grey point (star symbol) on the graph to indicate the point on the real GDP curve
that definitely represents a trough.
208
204
200
196
192
188
Real GDP
(Billions of Dollars)
188
184
190
180
194
204
202
198
196
200
206
Long-term growth trend
1980 1981 1982 1983 1984 1985 1986 1987 1988
YEAR
o
Real GDP
Peak
Trough

Calculate the percentage change in real GDP in each of the years shown. (Hint: The percentage change in real GDP equals the change in GDP from
the previous year to the current year. For example, you can calculate the percentage change for 1981 by finding the change in GDP from 1980 to
1981, dividing this change by the level of GDP in 1980, and then multiplying the result by 100.)
Once you've calculated the percentage change for each of the years, use the orange points (square symbol) to plot your results on the following
graph, rounded to the nearest percent. For each year, plot the percentage change from the year before. (Hint: For example, you should plot the
growth rate from 1980 to 1981 with a horizontal coordinate of 1981.)
ANNUAL CHANGE IN REAL GDP (Percent)
5
-5
1981
1982 1983
True
1984
O False
1985
1986
YEAR
This economy experienced a contraction in the years
which the level of real GDP
seen as a period in which the growth rate of real GDP
1987
True or False: This economy was experiencing a contraction in 1981.
1988
0
Annual Change
On the first graph (showing real GDP), this contraction is seen as a period in
On the second graph (showing annual change in real GDP), this contraction is

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