The four components of GDP (Gross Domestic Product) are personal consumption (C); investment (I); net exports (NX); and government expenditures (G). During the recession of 2007 to 2009, the component of AD (aggregate demand) that declined the most was private investment (see Google doc in the links below).
Government expenditures rose during the recession, as Obama spent government money on stimulus plans and on unemployment payments. Personal consumption also stayed relatively stable (though orders of durable goods fell as the recession went on). Net exports actually stayed stable or rose in 2007 and did not fall until the fourth quarter of 2008 and into 2009. Since the Great Recession, as the recession of 2007-2009 is called, net investment as a proportion of the GDP has declined to its lowest levels since the 1930s. Experts believe that the decline in investment demand is because of excess capacity, weak expectations of sales in the future, and shifting investment overseas (see the link below).
http://www.dollarsandsense.org/archives/2013/0713friedman.html
https://docs.google.com/spreadsheets/d/1GXR5C6Ek9bvwj4gpMqi1xeyq5eu82OFaX0xUBjaU__I/pub?single=true&gid=0&output=html
Thursday, April 4, 2019
Using all four components of GDP (C, I, G, and NX): Which of these four components of AD declined the most during the recession of 2007 to 2009?
Subscribe to:
Post Comments (Atom)
Summarize the major research findings of "Toward an experimental ecology of human development."
Based on findings of prior research, the author, Bronfenbrenner proposes that methods for natural observation research have been applied in ...
-
One way to support this thesis is to explain how these great men changed the world. Indeed, Alexander the Great (356–323 BC) was the quintes...
-
Polysyndeton refers to using several conjunctions in a row to achieve a dramatic effect. That can be seen in this sentence about the child: ...
-
Both boys are very charismatic and use their charisma to persuade others to follow them. The key difference of course is that Ralph uses his...
-
At the most basic level, thunderstorms and blizzards are specific weather phenomena that occur most frequently within particular seasonal cl...
-
Equation of a tangent line to the graph of function f at point (x_0,y_0) is given by y=y_0+f'(x_0)(x-x_0). The first step to finding eq...
-
Population policy is any kind of government policy that is designed to somehow regulate or control the rate of population growth. It include...
-
Gulliver cooperates with the Lilliputians because he is so interested in them. He could, obviously, squash them underfoot, but he seems to b...
No comments:
Post a Comment