Description

ECON 545 Week 4 Discussion, GDP and Economic Growth

This discussion is a great opportunity to learn about one of the most fundamental aspects of our economy, the Gross Domestic Product (GDP). GDP is the total value of final goods and services (output) the economy produces during a given period of time.

To learn about GDP in the real world and to answer the discussion questions, follow the steps below to obtain data from the Bureau of Economic Analysis.

1. Go to bea.gov(Links to an external site.)Links to an external site..
2. Click on the National tab (on the top left-hand side).
3. Click on Interactive Tables: GDP and the National Income and Product Account (NIPA) Historical Tables(Links to an external site.)Links to an external site. (on the left-hand side under subtitle Gross Domestic Product (GDP).
4. Click on Begin Using the Data (found under GDP & Personal Income).
5. Click on SECTION 1: Domestic Product and Income.
6. Click-on Table 1.1.1. Percent Change from Preceding Period in Real Gross Domestic Product (A) (Q).

To expand your search after you click on the Table, click on Modify on the top middle portion of the table above the results, and then change the First Year to 2005 and the Last Year to the current year. Change the Series to Annual, and then click on Refresh Table. Note what happened before and after the recession of 2007/2008.

Also, explore other tables, particularly Table 1.1.2. and Table 1.1.4, to learn about changes in prices and how and why GDP changes.

• What is the current GDP growth rate? Also, examine the trend of GDP growth over the past few years.
• What stage of the business cycle is the U.S. economy currently in given the trend of GDP growth?
• What components of GDP tend to decline significantly during recessions (particularly during the 2008 recession), and what GDP components rise during expansion? In other words, what aspects of GDP are mostly affected when the economy slows down, and why? econ 545 week 4 discussion