ECON312N Principles of Economics
Week 5 Assignment
Read/review the following resources for this activity:
Textbook: Chapter 14, 15
Link (website): FRED Economic Data (Links to an external site.)
Minimum of 2 scholarly sources
This assignment is based on the exploration and analysis of two of the most important economic variables used in economic analysis: Real GDP and Unemployment. These variables are compiled by the Bureau of Economic Analysis and are used extensively by the Federal Reserve of St Louis, in a database called FRED (Federal Reserve Economic Data), which is made up of nearly 140,000 economic time series from more than 50 data producers. The expectation is that at the end of the course, your new found ability to extract, manipulate, and understand economic data will be an enduring benefit from taking this course.
For this assignment, complete the following in the FRED Economic Data website:
Part A: Plot real GDP (Percent Change from Quarter One Year Ago – Quarterly Data) from 1977 (January) to 2018 (January). Note that the shaded areas on the graph show periods during which there were recessions.
Part B: Plot several measures of Unemployment from either 1977 or 1997 (Q1 – January) to 2018 (January) as specified in the instructions. Note that the shaded areas on the graph show periods during which there were recessions.
After plotting each graph in Part A and each Multi-Series Graph in Part B, copy and paste the graphs in a Word document. Then, provide a detailed comparative analysis of the performances of the variables. See the specific question in Parts A and B that follow.
Accessing and Using the FRED Website
Click on the link for the FRED Economic Data website (in the Required Resources area). Then, follows these steps:
To select the beginning date, click inside the first window and click on the arrows to get to the desired year. After selecting the year, a new window opens with a list of months. Select the desired month.
Click the second window and repeat step #4 to choose the end date.
After selecting the desired dates, the graph appears.
With the graph well-centered on your computer screen, press on the Prt Scr/Syst Rq key of your keyboard to copy the graph on the screen. Alternatively, you can also use the snipping tool on your computer to capture the graph. Note that the combination for a Screen Shot may be different for laptops.
Paste the graph in a Word document where you are writing your detailed analysis of the performances of the variables. Hint: make sure the following labels appear on the cropped graph: “FRED Graph” at the top left and “fred.stlouis.org” on the bottom right.
Part A: GDP: A Measure of Total Production and Income (Chapter 14)
Plot real GDP (FRED code: A191RO1Q156NBEA) from 1977 (January) to 2018 (January).
Provide a brief description of the general performance of the output of goods and services produced in the United States during periods of recessions (from 1980 to 2009).
Provide a general description of the performance of the economy during the Great Recession of 2007 to 2009 (Hint: focus your discussion on the following economic indicators: unemployment rates, incomes, profits, financial markets, real estate market etc.).
Plot real GDP per Capita (FRED code: A939RC0Q052SBEA) from 1977 (January) to 2018 (January).
Provide a general description of the performance of real GDP per capita from 1977 to 2018.
Most Economists, Policymakers, Social Scientists, and Business Analysts use a country’s real GDP per capita as the main indicator of the average person’s standard of living in that country. Robert Kennedy expressed his disagreement with the over-reliance on the use of GDP per capita with the following comments:
Gross Domestic Product, he argues “… does not allow for the health of our children, the quality of their education, or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials. It measures neither our courage, nor our wisdom, nor our devotion to our country. It measures everything, in short, except that which makes life worthwhile, and it can tell us everything about America except why we are proud that we are Americans” (1968, para. 23).
Do you agree or disagree with the late Robert Kennedy’s assessment of the importance of GDP per capita in determining the standard of living? Provide reasons to support your position.
Part B: Jobs and Unemployment (Chapter 15)
Items A-E below will require Multi-Series Graphs. This means plotting a graph with more than one variable (line). To add an additional line (variable) to a graph, you will first plot the initial variable, then click on the tab labeled as “Edit Graph.” An Edit Graph box opens.Click on the tab labeled “Add Line” within the Edit Graph box, and type the FRED code for the additional variable and hit enter. Select the correct variable from the list that populates and click the “add data series” tab. Note: you will do a separate Multi-Series Graph for each grouping (A-E) below:
Measures of Unemployment
Plot the variable Civilian Unemployment Rate (FRED code: UNRATE) from 1997 (January) to 2018 (January). (Note: this is the official Unemployment Rate)
Create a Multi-Series Graph and plot the variable Special Unemployment Rate (FRED Code – U6RATE) from 1994 (January) to 2018 (January). (Note: this is Total Unemployed, Plus All Marginally Attached Workers, Plus Total Employed Part-Time for Economic Reasons, as a Percent of the Civilian Labor Force plus all Marginally Attached Workers).
Plot the variable Of Total Unemployed, Percent Unemployed Less Than 5 Weeks (FRED code: LNS13008397) from 1977 (January) to 2018 (January).
Create a Multi-Series Graph and plot the variable Of Total Unemployed, Percent Unemployed 27 Weeks and Over (FRED code: LNS13025703) from 1977 (January) to 2018 (January).
Plot the variable Unemployment Rate – Bachelor’s Degree and Higher, 25 years and over (FRED code: LNS14027662) from 1997 (January) to 2018 (January).
Create a Multi-Series Graph and plot the variable Unemployment Rate – High School Graduates, No College, 25 years and over (FRED code: LNU04027660) from 1997 (January) to 2018 (January).
Plot the variable Unemployment Rate – Men (FRED code: LNS14000001) from 1977 (January) to 2018 (January).
Create a Multi-Series Graph and plot the variable Unemployment Rate – Women (FRED code: LNS14000002) from 1977 (January) to 2018 (January).
Plot the variable Unemployment Rate – White (FRED code: LNS14000003) from 1977 (January) to 2018 (January).
Create a Multi-Series Graph and plot the variable Unemployment Rate – Black (FRED code: LNS14000006) from 1977 (January) to 2018 (January).
Create a third line (variable) on this graph by plotting the variable Unemployment Rate – Hispanic (FRED code: LNS14000009) from 1977 (January) to 2018 (January).
Using the graphs on measures of unemployment, duration of unemployment, educational attainment, gender and race, provide a comprehensive assessment of the labor market during the period of the Great Recession (2007 to 2009). (NOTE: In responding to this question, please briefly comment on the employment situations before and after the Great Recession).
Writing Requirements (APA format)
Length: 3-5 pages (not including title page or references page)
12-point Times New Roman font
References page (minimum of 2 sources)