b)
The graphical representation of quarterly growth rates of real
b)
Explanation of Solution
The data of quarterly growth rates of real GDP from 1960 to last year using the percent change from a year ago is as follows:
Date | GDP, percentage change from quarter one year ago. |
1960-01-01 | 4.9 |
1960-04-01 | 2.1 |
1960-07-01 | 2.5 |
1960-10-01 | 0.9 |
1961-01-01 | -0.7 |
1961-04-01 | 1.6 |
1961-07-01 | 3.0 |
1961-10-01 | 6.4 |
1962-01-01 | 7.6 |
1962-04-01 | 6.7 |
1962-07-01 | 6.0 |
1962-10-01 | 4.3 |
1963-01-01 | 3.6 |
1963-04-01 | 3.8 |
1963-07-01 | 4.8 |
1963-10-01 | 5.2 |
1964-01-01 | 6.2 |
1964-04-01 | 6.2 |
1964-07-01 | 5.5 |
1964-10-01 | 5.2 |
1965-01-01 | 5.5 |
1965-04-01 | 5.7 |
1965-07-01 | 6.3 |
1965-10-01 | 8.5 |
1966-01-01 | 8.5 |
1966-04-01 | 7.5 |
1966-07-01 | 6.0 |
1966-10-01 | 4.5 |
1967-01-01 | 2.9 |
1967-04-01 | 2.6 |
1967-07-01 | 2.7 |
1967-10-01 | 2.7 |
1968-01-01 | 3.8 |
1968-04-01 | 5.5 |
1968-07-01 | 5.3 |
1968-10-01 | 5.0 |
1969-01-01 | 4.5 |
1969-04-01 | 3.1 |
1969-07-01 | 3.0 |
1969-10-01 | 2.0 |
1970-01-01 | 0.3 |
1970-04-01 | 0.2 |
1970-07-01 | 0.4 |
1970-10-01 | -0.2 |
1971-01-01 | 2.7 |
1971-04-01 | 3.1 |
1971-07-01 | 3.0 |
1971-10-01 | 4.4 |
1972-01-01 | 3.5 |
1972-04-01 | 5.3 |
1972-07-01 | 5.4 |
1972-10-01 | 6.9 |
1973-01-01 | 7.6 |
1973-04-01 | 6.3 |
1973-07-01 | 4.8 |
1973-10-01 | 4.0 |
1974-01-01 | 0.6 |
1974-04-01 | -0.2 |
1974-07-01 | -0.6 |
1974-10-01 | -1.9 |
1975-01-01 | -2.3 |
1975-04-01 | -1.8 |
1975-07-01 | 0.8 |
1975-10-01 | 2.6 |
1976-01-01 | 6.2 |
1976-04-01 | 6.2 |
1976-07-01 | 5.0 |
1976-10-01 | 4.3 |
1977-01-01 | 3.2 |
1977-04-01 | 4.5 |
1977-07-01 | 5.8 |
1977-10-01 | 5.0 |
1978-01-01 | 4.1 |
1978-04-01 | 6.1 |
1978-07-01 | 5.2 |
1978-10-01 | 6.7 |
1979-01-01 | 6.5 |
1979-04-01 | 2.7 |
1979-07-01 | 2.4 |
1979-10-01 | 1.3 |
1980-01-01 | 1.4 |
1980-04-01 | -0.8 |
1980-07-01 | -1.6 |
1980-10-01 | 0.0 |
1981-01-01 | 1.6 |
1981-04-01 | 3.0 |
1981-07-01 | 4.3 |
1981-10-01 | 1.3 |
1982-01-01 | -2.2 |
1982-04-01 | -1.0 |
1982-07-01 | -2.6 |
1982-10-01 | -1.4 |
1983-01-01 | 1.4 |
1983-04-01 | 3.3 |
1983-07-01 | 5.7 |
1983-10-01 | 7.9 |
1984-01-01 | 8.6 |
1984-04-01 | 8.0 |
1984-07-01 | 6.9 |
1984-10-01 | 5.6 |
1985-01-01 | 4.6 |
1985-04-01 | 3.7 |
1985-07-01 | 4.3 |
1985-10-01 | 4.2 |
1986-01-01 | 4.1 |
1986-04-01 | 3.7 |
1986-07-01 | 3.1 |
1986-10-01 | 2.9 |
1987-01-01 | 2.7 |
1987-04-01 | 3.4 |
1987-07-01 | 3.3 |
1987-10-01 | 4.5 |
1988-01-01 | 4.2 |
1988-04-01 | 4.5 |
1988-07-01 | 4.2 |
1988-10-01 | 3.8 |
1989-01-01 | 4.3 |
1989-04-01 | 3.7 |
1989-07-01 | 3.9 |
1989-10-01 | 2.7 |
1990-01-01 | 2.8 |
1990-04-01 | 2.4 |
1990-07-01 | 1.7 |
1990-10-01 | 0.6 |
1991-01-01 | -1.0 |
1991-04-01 | -0.5 |
1991-07-01 | -0.1 |
1991-10-01 | 1.2 |
1992-01-01 | 2.9 |
1992-04-01 | 3.2 |
1992-07-01 | 3.7 |
1992-10-01 | 4.4 |
1993-01-01 | 3.3 |
1993-04-01 | 2.8 |
1993-07-01 | 2.3 |
1993-10-01 | 2.6 |
1994-01-01 | 3.4 |
1994-04-01 | 4.2 |
1994-07-01 | 4.3 |
1994-10-01 | 4.1 |
1995-01-01 | 3.5 |
1995-04-01 | 2.4 |
1995-07-01 | 2.7 |
1995-10-01 | 2.2 |
1996-01-01 | 2.6 |
1996-04-01 | 4.0 |
1996-07-01 | 4.1 |
1996-10-01 | 4.4 |
1997-01-01 | 4.3 |
1997-04-01 | 4.3 |
1997-07-01 | 4.7 |
1997-10-01 | 4.5 |
1998-01-01 | 4.9 |
1998-04-01 | 4.1 |
1998-07-01 | 4.1 |
1998-10-01 | 4.9 |
1999-01-01 | 4.8 |
1999-04-01 | 4.7 |
1999-07-01 | 4.7 |
1999-10-01 | 4.8 |
2000-01-01 | 4.2 |
2000-04-01 | 5.3 |
2000-07-01 | 4.1 |
2000-10-01 | 3.0 |
2001-01-01 | 2.3 |
2001-04-01 | 1.1 |
2001-07-01 | 0.5 |
2001-10-01 | 0.2 |
2002-01-01 | 1.3 |
2002-04-01 | 1.3 |
2002-07-01 | 2.2 |
2002-10-01 | 2.1 |
2003-01-01 | 1.8 |
2003-04-01 | 2.0 |
2003-07-01 | 3.3 |
2003-10-01 | 4.3 |
2004-01-01 | 4.3 |
2004-04-01 | 4.2 |
2004-07-01 | 3.4 |
2004-10-01 | 3.3 |
2005-01-01 | 3.9 |
2005-04-01 | 3.6 |
2005-07-01 | 3.5 |
2005-10-01 | 3.1 |
2006-01-01 | 3.4 |
2006-04-01 | 3.1 |
2006-07-01 | 2.4 |
2006-10-01 | 2.6 |
2007-01-01 | 1.5 |
2007-04-01 | 1.8 |
2007-07-01 | 2.2 |
2007-10-01 | 2.0 |
2008-01-01 | 1.1 |
2008-04-01 | 1.1 |
2008-07-01 | 0.0 |
2008-10-01 | -2.8 |
2009-01-01 | -3.3 |
2009-04-01 | -3.9 |
2009-07-01 | -3.0 |
2009-10-01 | 0.2 |
2010-01-01 | 1.7 |
2010-04-01 | 2.8 |
2010-07-01 | 3.2 |
2010-10-01 | 2.6 |
2011-01-01 | 1.9 |
2011-04-01 | 1.7 |
2011-07-01 | 0.9 |
2011-10-01 | 1.6 |
2012-01-01 | 2.7 |
2012-04-01 | 2.4 |
2012-07-01 | 2.5 |
2012-10-01 | 1.5 |
2013-01-01 | 1.6 |
2013-04-01 | 1.3 |
2013-07-01 | 1.9 |
2013-10-01 | 2.6 |
2014-01-01 | 1.4 |
2014-04-01 | 2.7 |
2014-07-01 | 3.1 |
2014-10-01 | 2.9 |
2015-01-01 | 4.0 |
2015-04-01 | 3.3 |
2015-07-01 | 2.4 |
2015-10-01 | 1.9 |
2016-01-01 | 1.6 |
2016-04-01 | 1.3 |
2016-07-01 | 1.6 |
2016-10-01 | 2.0 |
2017-01-01 | 2.1 |
2017-04-01 | 2.2 |
2017-07-01 | 2.4 |
2017-10-01 | 2.8 |
2018-01-01 | 2.9 |
c)
The graphical representation of quarterly growth rates of real GDP from 1960 to last year using the percent change from preceding period quarterly. To ascertain the least volatile and most volatile measure, and the differences between these three series.
c)
Explanation of Solution
The data of quarterly growth rates of real GDP from 1960 to last year using the percent change from preceding period quarterly is as follows:
Date | GDP percent change from preceding period, quarterly |
1960-04-01 | -2.1 |
1960-07-01 | 2.0 |
1960-10-01 | -5.0 |
1961-01-01 | 2.7 |
1961-04-01 | 7.0 |
1961-07-01 | 7.9 |
1961-10-01 | 8.1 |
1962-01-01 | 7.3 |
1962-04-01 | 3.7 |
1962-07-01 | 5.0 |
1962-10-01 | 1.3 |
1963-01-01 | 4.4 |
1963-04-01 | 4.6 |
1963-07-01 | 9.1 |
1963-10-01 | 2.6 |
1964-01-01 | 8.7 |
1964-04-01 | 4.4 |
1964-07-01 | 6.4 |
1964-10-01 | 1.2 |
1965-01-01 | 10.0 |
1965-04-01 | 5.1 |
1965-07-01 | 9.2 |
1965-10-01 | 9.5 |
1966-01-01 | 10.1 |
1966-04-01 | 1.4 |
1966-07-01 | 3.4 |
1966-10-01 | 3.3 |
1967-01-01 | 3.6 |
1967-04-01 | 0.2 |
1967-07-01 | 3.8 |
1967-10-01 | 3.0 |
1968-01-01 | 8.4 |
1968-04-01 | 6.9 |
1968-07-01 | 3.1 |
1968-10-01 | 1.6 |
1969-01-01 | 6.4 |
1969-04-01 | 1.2 |
1969-07-01 | 2.7 |
1969-10-01 | -1.9 |
1970-01-01 | -0.6 |
1970-04-01 | 0.6 |
1970-07-01 | 3.7 |
1970-10-01 | -4.2 |
1971-01-01 | 11.3 |
1971-04-01 | 2.2 |
1971-07-01 | 3.3 |
1971-10-01 | 0.9 |
1972-01-01 | 7.6 |
1972-04-01 | 9.4 |
1972-07-01 | 3.8 |
1972-10-01 | 6.9 |
1973-01-01 | 10.3 |
1973-04-01 | 4.4 |
1973-07-01 | -2.1 |
1973-10-01 | 3.8 |
1974-01-01 | -3.4 |
1974-04-01 | 1.0 |
1974-07-01 | -3.7 |
1974-10-01 | -1.5 |
1975-01-01 | -4.8 |
1975-04-01 | 2.9 |
1975-07-01 | 7.0 |
1975-10-01 | 5.5 |
1976-01-01 | 9.3 |
1976-04-01 | 3.0 |
1976-07-01 | 2.2 |
1976-10-01 | 2.9 |
1977-01-01 | 4.8 |
1977-04-01 | 8.0 |
1977-07-01 | 7.4 |
1977-10-01 | 0.0 |
1978-01-01 | 1.3 |
1978-04-01 | 16.4 |
1978-07-01 | 4.1 |
1978-10-01 | 5.5 |
1979-01-01 | 0.7 |
1979-04-01 | 0.4 |
1979-07-01 | 3.0 |
1979-10-01 | 1.0 |
1980-01-01 | 1.3 |
1980-04-01 | -8.0 |
1980-07-01 | -0.5 |
1980-10-01 | 7.7 |
1981-01-01 | 8.1 |
1981-04-01 | -2.9 |
1981-07-01 | 4.9 |
1981-10-01 | -4.3 |
1982-01-01 | -6.1 |
1982-04-01 | 1.8 |
1982-07-01 | -1.5 |
1982-10-01 | 0.2 |
1983-01-01 | 5.4 |
1983-04-01 | 9.4 |
1983-07-01 | 8.2 |
1983-10-01 | 8.6 |
1984-01-01 | 8.1 |
1984-04-01 | 7.1 |
1984-07-01 | 3.9 |
1984-10-01 | 3.3 |
1985-01-01 | 3.9 |
1985-04-01 | 3.6 |
1985-07-01 | 6.2 |
1985-10-01 | 3.0 |
1986-01-01 | 3.8 |
1986-04-01 | 1.8 |
1986-07-01 | 3.9 |
1986-10-01 | 2.2 |
1987-01-01 | 3.0 |
1987-04-01 | 4.4 |
1987-07-01 | 3.5 |
1987-10-01 | 7.0 |
1988-01-01 | 2.1 |
1988-04-01 | 5.4 |
1988-07-01 | 2.4 |
1988-10-01 | 5.4 |
1989-01-01 | 4.1 |
1989-04-01 | 3.1 |
1989-07-01 | 3.0 |
1989-10-01 | 0.8 |
1990-01-01 | 4.4 |
1990-04-01 | 1.5 |
1990-07-01 | 0.3 |
1990-10-01 | -3.6 |
1991-01-01 | -1.9 |
1991-04-01 | 3.2 |
1991-07-01 | 2.0 |
1991-10-01 | 1.4 |
1992-01-01 | 4.9 |
1992-04-01 | 4.4 |
1992-07-01 | 4.0 |
1992-10-01 | 4.2 |
1993-01-01 | 0.7 |
1993-04-01 | 2.3 |
1993-07-01 | 1.9 |
1993-10-01 | 5.6 |
1994-01-01 | 3.9 |
1994-04-01 | 5.5 |
1994-07-01 | 2.4 |
1994-10-01 | 4.7 |
1995-01-01 | 1.4 |
1995-04-01 | 1.2 |
1995-07-01 | 3.5 |
1995-10-01 | 2.7 |
1996-01-01 | 3.0 |
1996-04-01 | 6.8 |
1996-07-01 | 3.6 |
1996-10-01 | 4.2 |
1997-01-01 | 2.6 |
1997-04-01 | 6.8 |
1997-07-01 | 5.1 |
1997-10-01 | 3.5 |
1998-01-01 | 4.1 |
1998-04-01 | 3.8 |
1998-07-01 | 5.1 |
1998-10-01 | 6.6 |
1999-01-01 | 3.8 |
1999-04-01 | 3.1 |
1999-07-01 | 5.3 |
1999-10-01 | 7.0 |
2000-01-01 | 1.5 |
2000-04-01 | 7.5 |
2000-07-01 | 0.5 |
2000-10-01 | 2.5 |
2001-01-01 | -1.1 |
2001-04-01 | 2.4 |
2001-07-01 | -1.7 |
2001-10-01 | 1.1 |
2002-01-01 | 3.5 |
2002-04-01 | 2.4 |
2002-07-01 | 1.8 |
2002-10-01 | 0.6 |
2003-01-01 | 2.2 |
2003-04-01 | 3.5 |
2003-07-01 | 7.0 |
2003-10-01 | 4.7 |
2004-01-01 | 2.2 |
2004-04-01 | 3.1 |
2004-07-01 | 3.8 |
2004-10-01 | 4.1 |
2005-01-01 | 4.5 |
2005-04-01 | 1.9 |
2005-07-01 | 3.6 |
2005-10-01 | 2.6 |
2006-01-01 | 5.4 |
2006-04-01 | 0.9 |
2006-07-01 | 0.6 |
2006-10-01 | 3.5 |
2007-01-01 | 0.9 |
2007-04-01 | 2.3 |
2007-07-01 | 2.2 |
2007-10-01 | 2.5 |
2008-01-01 | -2.3 |
2008-04-01 | 2.1 |
2008-07-01 | -2.1 |
2008-10-01 | -8.4 |
2009-01-01 | -4.4 |
2009-04-01 | -0.6 |
2009-07-01 | 1.5 |
2009-10-01 | 4.5 |
2010-01-01 | 1.5 |
2010-04-01 | 3.7 |
2010-07-01 | 3.0 |
2010-10-01 | 2.0 |
2011-01-01 | -1.0 |
2011-04-01 | 2.9 |
2011-07-01 | -0.1 |
2011-10-01 | 4.7 |
2012-01-01 | 3.2 |
2012-04-01 | 1.7 |
2012-07-01 | 0.5 |
2012-10-01 | 0.5 |
2013-01-01 | 3.6 |
2013-04-01 | 0.5 |
2013-07-01 | 3.2 |
2013-10-01 | 3.2 |
2014-01-01 | -1.1 |
2014-04-01 | 5.5 |
2014-07-01 | 5.0 |
2014-10-01 | 2.3 |
2015-01-01 | 3.2 |
2015-04-01 | 3.0 |
2015-07-01 | 1.3 |
2015-10-01 | 0.1 |
2016-01-01 | 2.0 |
2016-04-01 | 1.9 |
2016-07-01 | 2.2 |
2016-10-01 | 2.0 |
2017-01-01 | 2.3 |
2017-04-01 | 2.2 |
2017-07-01 | 3.2 |
2017-10-01 | 3.5 |
2018-01-01 | 2.5 |
2018-04-01 | 3.5 |
The graphical representation of the quarterly growth rates of real GDP from 1960 to 2018 using the percent change from the previous quarter is as follows:
The quarterly percent change at the annual rate indicates the percent change, if the quarterly rate goes on for four quarters. It is calculated by compounding of quarterly rate for four quarters.
For some unpredictable quarterly series, percentage changes at quarterly rates rather than at annual rates are preferred because the question of comparability is less relevant and because the annual rate of change is smaller.
When these three data and their respective graph compare to each other for some specific successive period of time, following result is determined:
- 2nd one that is, GDP growth rate using percentage change from quarter one year ago is most volatile and 3rd way that is, GDP growth rate by using percent change from preceding period quarterly is least volatile.
Want to see more full solutions like this?
Chapter 2 Solutions
Macroeconomics
- You are going to compare and contrast the GDP of the United States to that of another country of your choice for the last 3 years. Your report in narrative format should address the following questions: Describe the current GDP growth rate of the two countries. Which component of the GDP of the two countries changed the most for the last 3 years? Identify the possible causes of the changes. Describe the biggest component of the GDP of the two countries. What recommendations would you make in order to boost the GDP of the two countries?arrow_forwardIn the box on New Zealand, we derived an equation showing how the IIP changes over time: IIPt+ 1 = 11 + r2IIPt + NXt. Show that if g = (GDPt + 1 - GDPt) > GDPt is the growth rate of nominal output (GDP), and lower-case variables denote ratios to nominal GDP (as in the chapter), we can express this same equation in the form: Use this expression to find the ratio of net exports to GDP that holds the IIP to GDP ratio iip constant over time.arrow_forwardHow many recessions has France undergone over the years plotted in the chart? What are the two biggest recessions in terms of length and magnitude? Answer the questions from the figure given.arrow_forward
- You choose Italy as a country ,gather information and accumulate Data of its GDP for the past 10 years. Analyze the trends of GDP in the last 10 years Analyze the contribution of different Business Sectors to GDP Analyze the growing Business Sectors in Economy - analyze their contribution to GDP and analyze their contribution to other Macro Economic Performance Indicators of the country. Support your argument with reasons Analyze the Sectors (if any) which are showing negative growth in the last (0 -10) years. Give reasons Analyze and give suggestions to the government that which Business sectors should be supported by the government for Economic Growth of the economy. give this and in 3000 words along with tables charts and graphs.arrow_forwardYear Real GDP Nominal GDP 2019 $15,510.79 $17,310.70 2020 $17,495.23 $18,761.83 2021 $18,209.59 $19,253.97 Refer to the table above. What is the growth rate in real GDP from 2020 to 2021? Answer this as a percentage and round your answer to two digits after the decimal without the percentage sign. ex. If you found the rate to be 5.125%, answer 5.13.arrow_forwardPart C: Following graph shows business cycle fluctuation in a hypothetical economy. "Y" denotes year, and "Q" denotes quarter. What do points A, B, C, and D denote? Write at least a sentence each about what these points denote. Also, explain what represent the curve segments: A to B, B to C, and C to D. Lastly, because economic activity fluctuates, how is long-term growth possible? Real GDP (billion $) 50 45 40 B 35 30 25 20 15 10 5 Y1Q1 Y1Q2 Y1Q3 Y1Q4 Y2 Q1 Y2 Q2 Y2 Q4 Y3 Q1 Y3Q2 un oarrow_forward
- ANNUAL CHANGE IN REAL GDP (Percent) , دن A -5 1981 1982 Peak Recovery 1983 Expansion 1984 Trough 1985 YEAR This economy experienced a contraction in the year period in which the level of Real GDP contraction is seen as a period in which the growth rate of Real GDP 1986 1987 1988 In 1988, which of the following phases in the business cycle could this economy have been experiencing? Check all that apply. Annual Change . On the first graph (showing Real GDP), this contraction is seen as a On the second graph (showing annual change in Real GDP), thisarrow_forwardDescribe the various components of fluctuations in economic activity over time. Because economic activity fluctuates, how is long-term growth possible?arrow_forwardMacroeconomics analyzes the growth in production, employment and income of a country in relation to the rhythm of the aggregate expenditure of the society and how it is affected by the particular problems of each yeararrow_forward
- c) The production and prices of T-Shirts and Jeans in Fashion Land in 2020 and 2021 are as follows: Quantity of T- Quantity of Price of T- Price of Shirts Jeans Shirts Jeans (thousands) (thousands) 2020 10 $25 10 $60 2021 15 $30 12 $70 Taking 2020 as the base year, calculate the: i) Nominal GDP in 2021 ii) Real GDP in 2020 and 2021 i) Real GDP Growth Rate in 2021 iv) Nominal GDP per Capita in 2021 if the population is 550.arrow_forwardAn economy produces three products, bags, computers and shirts. The prices and quantities of these products in 2020 and 2021 are shown in the table below: 2020 2021 Price Price Quantity Quantity 300 $10 $12 330 Bags Computers $600 100 $650 110 Shirts $18 2,000 $20 2,200 2020 2021 Measure the nominal and real GDP for 2019 and 2020, using 2020 as the base year. Measure the nominal and real GDP growth rate in 2021. Which value is more accurate in measuring the growth rate of the economy? Explain. (b) The information on price and quantity of three products consumed by a typical household in the year 2020 and 2021 is given by the table below 2020 2021 Price Quantity Price 10 Quantity $5 $5.50 12 Fish Beef $10 5 $11 4 Train Ride $8 20 $9 22 Using 2020 as the base year, measure the CPI for 2021 and the inflation rate in 2021. Does this inflation rate correctly measure the cost of living changes for households in 2021? Explain.arrow_forwardThe following table shows Spain’s (annualized) quarterly real GDP growth rates for the 2007–2012 period. (Roman numbers refer to quarters.) a) Plot real GDP growth rate in a graph, and identify a trend in the data. b) Based on the data shown, identify the beginning (i.e., the year and the quarter) of the current recession.arrow_forward
- Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage LearningMacroeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506756Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage LearningEconomics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning