Please enable JavaScript.
Coggle requires JavaScript to display documents.
Reading 38: Economic indicators, (Sancino, 2017.p,) - Coggle Diagram
Reading 38: Economic indicators
1 Gross Domestic Product (GDP)
the aime
the way measurement
expenditure measure
income measure.
output measure
uses
identify the contribution
compare economic performance
or determining monetary
policy
understanding concept of economic
growth
identify the economic cycle stage
the rate calculation
GDP growth rate:
Change in GDP over one period /GDP at the start of the period = × 100
interpreting
possibilities
the value of the GDP is up on the previous three months, the economy is growing.
If the value of the GDP is down on the previous three months, the economy is contracting.
Two consecutive three-month periods of contraction
mean an economy is in recession
1- in length
consecutive 3-month periods
2- in depth.
the size and length of negative growth rates
if
the GDP value meaning for business
If the growth rate is high
A strong growth rate
1 more item...
slow or negative with unemployment
1 more item...
A forecast GDP VALUE over the next year
1 more item...
positive indicator for economy
2 Consumer Price Index
the definition
aims to measure
Inflation
the inflation impact
things will be more expensive
less confidence
in their ability to spend and invest
level of consumption as well as the level of
investment by firms.
if wages and other incomes are also rising
with inflation
inflation may be more subtle
1 more item...
deflation
deflation impact
trigger a vicious cycle
consumer postpone their purchases
cause a significant drop in consumption
impacting on firms.
the importance
it can say something about future consumer spending behaviour.
the index calculation
using a weighted average
The rate of inflation
CP level in current period − CP level in previous period /CP level in previous period*100
New consumer price index =
Consumer price level in new year /
Consumer price index in base year*100
3 Rate of unemployment
the importance and uses
types
unemployment types
voluntarily
involuntarily
employment types
selfemployment
wage
definitions
total unemployment
and work force
actively job seeking
the rate of unemployment
the rate calculation
Unemployment rate =
unemployment/labour force x 100
THE RATE INTERPRETATION
the definition
An economic indicator is
a statistic about an economic activity.
(Sancino, 2017.p,)