Economic Forecast

Economic Forecast

Economics

scarce resources. Subdivided into microeconomics, which examines the behavior of firms, consumers and the role of government; and macroeconomics, which looks at inflation, unemployment, industrial production, and the role of government.

Microeconomics

It is the study of the behavior of small economic units or specific subgroup such as that of individual consumers or households.

Macroeconomics

It is the study of the behavior of an economy at the aggregate level, as opposed to the level of a specific subgroups or individuals (which is called microeconomics). For example, a macroeconomist might consider the industrial sector, the services sector or the farm sector, but he/she will not consider specific parts of any of these sectors. Factors studies include inflation, unemployment, and industrial production, often with the aim of studying the effect of government policy on these factors.

Economic indicator

It indicates the statistical data that shows general trends in the economy. Those with predictive value are leading indicators; those occurring at the same time as the related economic activity are coincident indicators; and those that only become apparent after the activity are lagging indicators.

Examples are unemployment, housing starts, Consumer Price Index, industrial production, bankruptcies, GDP, stock market prices, money supply changes, and housing starts.

GROSS DOMESTIC PRODUCT

Gross Domestic Product is the total market value of all the final goods and services produced within a nation's borders in a given time period. Each goods and services produced and brought in the market has a price. The price of the total output is called as GDP. It can be measured by either cumulating all the income earned in the economy or all the spending in the economy and both measures should roughly equate to the same total.

The Gross domestic income includes the following items:

1) Wages and salaries paid to the labor force.

2) Corporate profits earned by the country's businesses.

3) Interest charged by lenders (i.e., banks).

4) Taxes collected by governments.

The Gross domestic expenditure includes the following items:

1) Consumer spending on items such as food, clothing, services, and other items.

2) Investments in plant, equipment, inventories & household residences.

3) Government spending for defense, roads, schools, and other items.

4) The value of exports minus imports.

Two ways to measure GDP

Nominal GDP is the value of final output produced in a given period, measured in the prices of that period (current period). As the price level changes everyday, both real and nominal GDP are regularly reported. Nominal GDP is computed simply by adding the current dollar value of the production.

Real GDP is the value of final output produced in a given time period, adjusted for changing prices. Real GDP is the inflation adjusted value of nominal GDP. Real GDP is calculated by adjusting the market value of goods and services for changing price.

Most Recent Six Months Data

Signal to current state of economy

GDP indicates the current health of an economy. It is the basic measure of an economy's size. GDP provides a useful perspective on the way the economy works. It shows how factor markets relate to product markets. It shows how output relates to ...