Question

How has the U.S. economy been doing in recent years? Why do you think that is?...

How has the U.S. economy been doing in recent years? Why do you think that is? Gather relevant economic statistics, such as the growth rate of real GDP, the unemployment rate, and the inflation rate, to support your case. Did any of the data from the project surprise you? Which data? Why? Does this data indicate a growing, stagnant or declining economy? What does this data tell you about the health of our economy? Why? Find a current news or journal article that describes our current economy and that supports your opinion.

Homework Answers

Answer #1

Economists forecasts leading economic indicators as a result of they measure the first influence on growth. In Oct 2019, they report that the economy is faltering slightly. it's slightly slower growth, low unemployment, and inflation is below target. however its still nearly a Goldilocks economy as a result of it's neither too hot nor too cold.

The unemployment rate is additionally a problem. It's 3.5%. it is a lagging indicator and then is not as helpful a data point. firms typically wait till a recession is well underway before laying off employees. It additionally takes a minute to cut back the unemployment rate, even once hundreds of thousands of recent jobs are created.

The economy is measured by gross domestic product. that is the dollar worth of everything created within the last year. the most vital indicator is GDP growth, that compares this quarter with the last. If the economy is healthy, then GDP growth are between 2-3%. If it's on top of third-dimensional. once it's below two, then it's at risk of contraction. If it's below zero, then it's during a recession.

Durable goods are machinery, instrumentation and raw materials that companies use in their operations. consider steam shovels, tanks, and airplanes. In fact, business planes are the biggest element of durable.

Inflation measures rising prices. the present rate of inflation as measured by the buyer index is two.4% in Sep.

The securities market tells you what investors assume the economy can do. It additionally reflects company earnings and gain. Businesses will manipulate earnings to create them look higher. however within the long-term, stock prices impact demand and the health of the economy.

Interest rates management however expensive it's to borrow for each businesses and customers. once interest rates are low, you can borrow more cheaply and buy a much bigger house, a nicer automobile, and other furniture. Businesses can borrow more to expand their firms, buy equipment and hire other employees. the alternative happens if interest rates rise.

The central bank monitors the core rate of inflation as a result of it leaves out volatile food and gas costs. It additionally prefers the year over year rate of inflation as a result of it removes the impact of differences due to the season.

The Fed's inflation gauge is that the PCE index. It said the core rate of inflation was 1.8%. that is once reason the Fed down rates at its last FOMC meeting. The Committee is additionally distressed about speed growth.

The Fed sets a target rate of twenty-two year-over-year for the core rate. That level of inflation is healthy as a result of than customers expect costs to rise. that creates them other possible to shop for now, instead of wait. The enhanced demand spurs economic process. The Fed uses the rate of inflation once deciding whether to lift the fed funds rate.

Reality Check verdict: affirmative, the economy has done well - however there are periods once it absolutely was even stronger. the expansion in GDP - the worth of products and services within the economy - has usually been sturdy. the foremost recent information shows a 3.1% growth for the primary quarter of 2019.

As pr my knowledge, it'll be two in 2020 and 1.8% in 2021. that is in line with the most recent forecast discharged at the Federal Open Market meeting on June 19, 2019. The projected delay in 2019 . It may be a side effect of the unemployment rate can average 3.6% in 2019.

The second quarter deficit was 2.4 percent of current dollar gross domestic product, down from 2.6 % within the first quarter.

The economy of the America could be an extremely developed economic system. it's the world's largest economy by nominal GDP and the second-largest by buying power parity . It additionally has the world's eighth-highest per capita GDP (nominal) and the tenth-highest per capita GDP in 2018.

38 percent of respondents aforesaid they believe the U.S. can enter its next recession in 2020, and 34 % picked 2021; solely 14 percent say it'll occur then.

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