Macroeconomic Variables



Macroeconomic Variables

Introduction

Macroeconomics is a branch of economics concerned with the aggregate, or overall, economy. Macroeconomics deals with economic factors such as total national output and income, unemployment, balance of payments, and the rate of inflation. It is distinct from microeconomics, which is the study of the composition of output such as the supply and demand for individual goods and services, the way they are traded in markets, and the pattern of their relative prices.

Forecasting GDP CPI and Unemployment Rates

There have recently been signs indicating that the recession may be bottoming out. Most forecasters expect economic growth to resume early this year. While private forecasters anticipate a mild recession and a steady recovery, the administration assumes a more gradual recovery, despite its assumption that the policies proposed in the budget - notably, the bipartisan economic security package to insure that the recovery does not falter - will be adopted.( U.S. House of Representatives)

The Congressional Budget Office [CBO] assumes a stronger and more rapid recovery. The Congressional Budget Office [CBO] has projected that the nominal GDP will be 10521 billion dollars in 2002 and 11092 in 2003 and the administration 's Office of Management and Budget [OMB] has projected that the nominal GDP will be 10481 billion dollars in 2002 and 11073 billion dollars in 2003 while the Research Department of the Federal Reserve Bank of Philadelphia (FRBP) has projected that the nominal GDP will be 10502 billion dollars in 2002 and 11078 in 2003.

CBO has projected that the Real GDP will increase by 0.8% in 2002 and 4.1% in 2003. The 2002 percentage is the same as that FRBP has projected, but 0.1% higher than OMB projections. CBO's 2003 projection for real GDP is the highest among these three financial institutions as OMB has projected 3.8% increase while FRBP has ...