State of the economy Essay Example | Topics and Well Written Essays - 750 words - 2

State of the economy - Essay ExampleIt fashion that the U.S. economy has improved a lot as compared to the U.S. economy back in 2008. Based on the historical trend of quarter-to-quarter growth in real GDP, the U.S. real GDP tend to increase during the quaternary quarter of each year. The trend strongly suggests that demand for products and services usually increase between October to December of each year. (See Figure I Quarter-to-Quarter Growth in Real GDP on page 2)CPI is delineate as a measure of the overall cost of the goods and services bought by a common consumer (Mankiw 834). There is a significant relationship between the real GDP and CPI. Given that the real GDP falls into negative values, the CPI also tends to be at the lowest value. For instance, the real GDP during the 4th quarter of 2008 was -9%. As a result, the CPI during these periods was following a declining trend from 216.573 in October 2008 down to 210.228 in December 2008. (See Table I Five-Year Summary of C PI below Figure II Five-Year CPI Trend in U.S. on page 3)Unemployment appreciate is defined as the number of unemployed people who want to have a job but do not have one (Kennedy 36). The U.S. unemployment rate is in some manner related to the countys real GDP. Since the real GDP was at the lowest during the last quarter in 2008, its unemployment rate started to rise significantly on January 2008. It means that there were a lot of companies in the U.S. that had to implement a massive lay-off or close down the company due to bankruptcy. Since the 4th quarter of 2010, the unemployment rate in the United States was moving on a downward trend. The continuous decrease in the U.S. unemployment rate was possible since the U.S. real GDP and CPI was in some manner increasing. (See Table II U.S. Unemployment Rate below Figure III Trend of U.S. Unemployment Rate on page 4)Other useful economic indicators include the maker price index (PPI), interest rates, and export and imports. Specif ically the PPI