ECON302 SFSU Economic Data Interpretation Assignment

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Economics

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The detail of the homework is in the file.

Part I: Data Collection

Part II: Data Processing

Part III: Data Interpretation

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Part I: Data Collection
Use FRED database to obtain the following quarterly data to complete Write-up 1:
https://fred.stlouisfed.org/

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Econ 302 L02 Fall 2019 Janko Z. Write-up 1: Due: September 27th by 10pm on iLearn. Part I: Data Collection Use FRED database to obtain the following quarterly data to complete Write-up 1: https://fred.stlouisfed.org/ 1. 2. 3. 4. 5. Real Gross Domestic Product, Billions of Chained 2012 Dollars, Seasonally Adjusted Real Gross Domestic Product per capita, Billions of Chained 2012 Dollars, Seasonally Adjusted Real Personal Consumption Expenditures, Billions of Chained 2012 Dollars, Seasonally Adjusted Real Gross Private Domestic Investment, Billions of Chained 2012 Dollars, Seasonally Adjusted Real Government Consumption Expenditures and Gross Investment, Billions of Chained 2012 Dollars, Seasonally Adjusted REMARKS: “chained 2012 dollars” implies that the data you are obtaining is in real terms; seasonally adjusted means it accounts for seasonal changes (such as those that occur at Christmas time or the summer season); while the frequency is quarterly, all the above data are annualized, so be careful when interpreting individual data points. Part II: Data Processing Obtain all Figures directly from FRED (just download them), and then use Excel to obtain all statistics (i.e. to construct your table with all summary statistics); detained instructions are below. All tables and graphs need to be included in your write-up. Make sure to title your tables (Table 1: xxx; Figure 1: xxx, etc). 1. Obtain a plot of real GDP and real GDP per capita in levels (i.e. just use the data as is); plot each individually (i.e. need 2 figures). 2. Obtain the growth rate of real GDP and real GDP per capita and plot on the same diagram. To obtain the growth rate of each series, you want to obtain growth rate from “a year ago” not the growth rate from the previous quarter. HINT: go to “edit data” and select the new units: “% from a year ago”. (this is the data you should also download to obtain your summary statistics). 3. Use the data on Real GDP, Real Consumption, Real Investment, and Real Government Expenditure to obtain 3 new series: a) Real Consumption to GDP ratio, b) Real Investment to GDP ratio, c) Real Government Expenditure to GDP ratio. Once you have these 3 series, plot all 3 on one diagram. 4. Summary Statistics. You will need to use Excel to obtain summary statistics of some of the variables you have plotted (see the list in part a) below of the 5 variables that you need to work with). 1 Econ 302 L02 Fall 2019 Janko Z. You will need to obtain 3 sets of statistics: 1st using the whole sample period, 2nd using only data up to/including the 2nd quarter of 2009, and 3rd using data from Quarter 3 of 2009 (i.e. since the end of the GREAT RECESSION). Once you obtain all summary statistics, you will need to create ONE table with all these statistics (you can create a table in excel and copy it into word or create a table in word directly). You must submit a single table with all of the statistics. a. Use the following series (variable) to obtain all summary statistics: i. Growth of Real GDP ii. Growth of Real GDP per capita iii. Real Consumption to GDP ratio iv. Real Investment to GDP ratio v. Real Government expenditure to GDP ratio b. Summary statistics to calculate: Average, standard deviation, min, and max. (present your statistics in this order). Remarks: 1. You have 5 series for which you need to obtain 4 statistics: so that is 5x4 = 20 statistics. Since you need to do this for 3 different sample periods, you will need 60 statistics in total. 2. At the end, this write-up should have 4 figures and 1 table. Part III: Data Interpretation Now that you have all the figures and summary statistics, you want to discuss what you observe in the Figures and in the Table. The general rule in writing reports of this type is “if you have a figure it must be discussed” and “if you have a table discuss the important patterns/changes/etc. not all individual stats per say”. You should be able to discuss how the data has changed over time, any striking changes/differences/etc. you observe in the data (just do a visual inspection), what has been the performance since the end of the Great Recession, etc. Note that you are not asked to conduct an analysis at this stage, as you do not have enough information to do that. You can however discuss whether the economy is in an expansion or recession and what general patterns you observe across recessions/expansions in the data you have plotted. Make sure to discuss all your time series. Given the large # of statistics that you have in your table, you are not expected to discuss all the statistics; instead be selective in using the statistics to tell a story/narrative. Your write-up should be at max 500 words (not including figures and tables). It should be written in paragraph form and be succinct. Avoid the use of bullets or lists. Use 11-12 font size and double space (so I have somewhere to write comments if needed). The final version of your write-up 1 should have 4 figures, 1 table, and a write up of 500 words or less. Present at least 2 figures per page. This means that the write-up should be at most 5 pages (without a title page). 2
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Explanation & Answer

Attached.

Running head: DATA INTERPRETATION

Economic Data Interpretation
Student’s Name
Institutional Affiliation

1

DATA INTERPRETATION

2
Economic Data Interpretation

The report provides the findings from collected economic data over the years for various
economic attributes. Bell, Bryman, and Harley (2018) defined data interpretation as the act of explaining
the insight developed from the piece of analyzed information essential in making inferences suitable for
decision making. In this case, the elaboration will involve making inferences from collected and
processed economic data, using various indicators, such as the US Actual GDP, GDP per capita,
Domestic Investment, among other economic attributes. The information is presented in the charts and
table below and an inference provided to explain the observed unique trends associated with the
American economic growth.
Real Gross Domestic Product
Real Gross Domestic Product, Billions of Chained 2012 Dollars, Quarterly, Seasonally Adjusted Annual
Rate
20000.0

Billion of Chained 2012 Dollars

18000.0
16000.0
14000.0
12000.0
10000.0
8000.0
6000.0
4000.0

0.0

1947-01-01
1948-05-01
1949-09-01
1951-01-01
1952-05-01
1953-09-01
1955-01-01
1956-05-01
1957-09-01
1959-01-01
1960-05-01
1961-09-01
1963-01-01
1964-05-01
1965-09-01
1967-01-01
1968-05-01
1969-09-01
1971-01-01
1972-05-01
1973-09-01
1975-01-01
1976-05-01
1977-09-01
1979-01-01
1980-05-01
1981-09-01
1983-01-01
1984-05-01
1985-09-01
1987-01-01
1988-05-01
1989-09-01
1991-01-01
1992-05-01
1993-09-01
1995-01-01
1996-05-01
1997-09-01
1999-01-01
2000-05-01
2001-09-01
2003-01-01
2004-05-01
2005-09-01
2007-01-01
2008-05-01
2009-09-01
2011-01-01
2012-05-01
2013-09-01
2015-01-01
2016-05-01
2017-09-01
2019-01-01

2000.0

Observation Date

Figure 1: The graph shows the growth of real GDP (Source: Federal Reserve Bank 2019)
Inference
From figure 1 above, the real GDP seasonally adjusted depicts an increasing growth over the
years. Nonetheless, there is a notable decline in the first and second quarter year 2009, indicating an
economic recession marked by declined economic activities.

Percent Change From Year Ago

16.0
14.0
12.0
10.0
8.0
6.0
4.0
2.0
0.0
-2.0
-4.0
-6.0

1948-01-01
1949-06-01
1950-11-01
1952-04-01
1953-09-01
1955-02-01
1956-07-01
1957-12-01
1959-05-01
1960-10-01
1962-03-01
1963-08-01
1965-01-01
1966-06-01
1967-11-01
1969-04-01
1970-09-01
1972-02-01
1973-07-01
1974-12-01
1976-05-01
1977-10-01
1979-03-01
1980-08-01
1982-01-01
1983-06-01
1984-11-01
1986-04-01
1987-09-01
1989-02-01
1990-07-01
1991-12-01
1993-05-01
1994-10-01
1996-03-01
1997-08-01
1999-01-01
2000-06-01
2001-11-01
2003-04-01
2004-09-01
2006-02-01
2007-07-01
2008-12-01
2010-05-01
2011-10-01
2013-03-01
2014-08-01
2016-01-01
2017-06-01
2018-11-01

Billion of Chained 2012 Dollars

0.0
1947-01-01
1948-05-01
1949-09-01
1951-01-01
1952-05-01
1953-09-01
1955-01-01
1956-05-01
1957-09-01
1959-01-01
1960-05-01
1961-09-01
1963-01-01
1964-05-01
1965-09-01
1967-01-01
1968-05-01
1969-09-01
1971-01-01
1972-05-01
1973-09-01
1975-01-01
1976-05-01
1977-09-01
1979-01-01
1980-05-01
1981-09-01
1983-01-01
1984-05-01
1985-09-01
1987-01-01
1988-05-01
1989-09-01
1991-01-01
1992-05-01
1993-09-01
1995-01-01
1996-05-01
1997-09-01
1999-01-01
2000-05-01
2001-09-01
2003-01-01
2004-05-01
2005-09-01
2007-01-01
2008-05-01
2009-09-01
2011-01-01
2012-05-01
2013-09-01
2015-01-01
2016-05-01
2017-09-01
2019-01-01

DATA INTERPRETATION

Real Gross Domestic Product % Change

3

Real Gross Domestic Product Per Capita
Real gross domestic product per capita, Chained 2012 Dollars, Quarterly, Seasonally Adjusted Annual
Rate

70000.0

60000.0

50000.0

40000.0

30000.0

20000.0

10000.0

Observation Date

Figure 2: The graph shows the growth of GDP per Capita (Source: Federal Reserve Bank 2019)

Inference

From figure 2 above, the real GDP per Capita reveals an upward trend over the observation dates.

Similarly, the chart shows a significant reduction in the GDP per Capita in the year 2009 first and second

quarter the time marked by a global economic recession.

GDP and GDP per Capita Percent Shift from Year Ago

GDP & GPD Per Capita Percent Change From Year Ago

Real gross domestic product per capita % Change

Observation Date

Figure 3: The chart depicts the GDP &GDP per Capita Percent Change from A year Ago (Source:
Federal Reserve Bank 2019)

DATA INTERPRETATION

4

Inference
Figure 3 above represents the percent shift a year ago for the economic attributes GDP and GDP
per Capita. The percent variation a year ago for the GDP and GDP per Capita reveals an oscillating
pattern around the means 2.0% and 3.2 % for GDP per Capita and GDP respectively.
Real Consumption, Investment & Government Expenditure to GDP Ratio
Real Consumption, Investment & Government Expenditure to GDP Ratio
PCE/GDP

GPDI/GDP

GEXPND/GDP

0.8
0.7

Bil.of $/Bil. of $

0.6
0.5
0.4
0.3
0.2

0

1947-01-01
1948-05-01
1949-09-01
1951-01-01
1952-05-01
1953-09-01
1955-01-01
1956-05-01
1957-09-01
1959-01-01
1960-05-01
1961-09-01
1963-01-01
1964-05-01
1965-09-01
1967-01-01
1968-05-01
1969-09-01
1971-01-01
1972-05-01
1973-09-01
1975-01-01
1976-05-01
1977-09-01
1979-01-01
1980-05-01
1981-09-01
1983-01-01
1984-05-01
1985-09-01
1987-01-01
1988-05-01
1989-09-01
1991-01-01
1992-05-01
1993-09-01
1995-01-01
1996-05-01
1997-09-01
1999-01-01
2000-05-01
2001-09-01
2003-01-01
2004-05-01
2005-09-01
2007-01-01
2008-05-01
2009-09-01
2011-01-01
2012-05-01
2013-09-01
2015-01-01
2016-05-01
2017-09-01
2019-01-01

0.1

Observation Date

Figure 4: The chart illustrates the Consumption, Investment & Government Expenditure to GDP Ratio
(Source: Federal Reserve Bank 2019)
Inference
Figure 4 above depicts the real consumption, domestic investment, and government expenditure
to the GDP ratio over the years. Notably, the line graphs reveal a relatively constant ratio for the attributes
against the GDP with minimal deviations.

DATA INTERPRETATION

5
Descriptive Statistics

Table 1: The table illustrates the summary statistics of the economic attributes (Source: Federal Reserve
Bank 2019)
Real GDP
Descriptive
Statistics
Average
Standard Deviation
Minimum
Maximum

8611.51
5097.43
2023.45
19023.02

Average
Standard Deviation
Minimum
Maximum

7269.25
4104.25
2023.45
15761.97

Average
Standard Deviation
Minimum
Maximum

17000.67
1125.45
15189.22
19023.02

Real GDP
per capita

Real
Real Investment Real Government
Consumption to
to GDP ratio
expenditure to GDP
GDP ratio
ratio
Total Sampled data
33358.70
0.63
0.17
0.30
13353.32
0.03
0.02
0.04
13999.00
0.59
0.13
0.19
57797.00
0.69
0.21
0.38
Sampled data up to/ including Quarter 2 2009
30168.30
0.63
0.17
0.29
11485.90
0.03
0.02
0.04
13999.00
0.59
0.13
0.19
52049.00
0.68
0.21
0.37
Sampled data from Quarter 3 2009
53298.75
0.68
0.16
0.34
2446.75
0.00
0.01
0.02
49384.00
0.68
0.13
0.33
57797.00
0.69
0.18
0.38

Inference
Table 1 above reveals the descriptive statistic for different economic attributes. Compared to the
mean for the total sampled data, the average GDP declined for the period before and including the second
quarter 2009 depicting US$ 8,611.51 bn to US$ 7,269....


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