...Question 1 (i) Trade balance, GDP and Ratio of the trade balance to GDP in Finland(1980-2006) | Year | Trade Balance | GDP | Ratio of the trade balance to GDP | | Billion (euro) | Billion (euro) | | | (TB) | (Y) | (TB/Y) | 1980 | -0.461 | 33.267 | -0.01 | 1981 | 0.363 | 37.593 | 0.01 | 1982 | 0.049 | 42.258 | 0.00 | 1983 | -0.040 | 47.163 | 0.00 | 1984 | 1.298 | 52.695 | 0.02 | 1985 | 0.479 | 57.345 | 0.01 | 1986 | 0.678 | 61.492 | 0.01 | 1987 | 0.137 | 66.766 | 0.00 | 1988 | -0.468 | 75.728 | -0.01 | 1989 | -1.441 | 84.801 | -0.02 | 1990 | -1.200 | 89.535 | -0.01 | 1991 | -0.353 | 85.767 | 0.00 | 1992 | 0.690 | 83.124 | 0.01 | 1993 | 3.832 | 83.817 | 0.05 | 1994 | 5.004 | 88.159 | 0.06 | 1995 | 7.261 | 96.003 | 0.08 | 1996 | 7.425 | 99.080 | 0.07 | 1997 | 8.625 | 107.633 | 0.08 | 1998 | 10.309 | 117.104 | 0.09 | 1999 | 12.269 | 122.642 | 0.10 | 2000 | 13.485 | 132.324 | 0.10 | 2001 | 14.816 | 139.855 | 0.11 | 2002 | 15.348 | 144.007 | 0.11 | 2003 | 12.170 | 146.226 | 0.08 | 2004 | 12.117 | 152.236 | 0.08 | 2005 | 8.650 | 157.358 | 0.05 | 2006 | 10.991 | 168.162 | 0.07 | There is an overall increasing trend for the behavior of trade balance/ GDP growth in Finland over 1980-2006, which shows that the net export of the domestically produced products in Finland is rising. (ii) | Correlation coefficient | (TBY, dyt-2) | 0.14 | (TBY, dyt-1) | 0.40 | (TBY, dyt) | 0.27 | (TBY,...
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...Information Sharing and the effect on the supply of credit B.Sc. Thesis Finance Date: 2011-5-29 Name: Martijn Verwijs1 (Anr: 272713) Thesis supervisor: Erik von Schedvin 1 Email: m.m.verwijs@uvt.nl Table of contents Chapter 1: Introduction of the problem..................................................................................................... 3 1.1 Problem background........................................................................................................................ 3 1.2 Research question ............................................................................................................................ 4 1.3 Empirical approach.......................................................................................................................... 4 1.4 Main Findings.................................................................................................................................. 5 1.5 Overview ......................................................................................................................................... 5 Chapter 2: Literature review ..................................................................................................................... 6 Chapter 3: Data overview ....................................................................................................................... 12 Chapter 4: Empirical setup ...........................................................
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...References: 11 Introduction: GDP is the total market value of all final goods and services produced in a country in a given year.GDP can be stated in two forms: Current price and constant price. Nominal GDP or GDP at current measures the value of output of a given by using the prices of that particular year. Where Real GDP or GDP at constant price shows the value of all output of a given year expressed in base year prices (according to Bangladesh economic review 2010 the base year is consider to be 1995-96). GDP is a key indicator of macroeconomic and increased in GDP is consider to very desirable because it generates higher income and lower unemployment and Government borrowing. Though global economy experienced an unparallel financial crisis, the Bangladesh Bureau of Statistics (BBS) estimated GDP growth of 5.83% for the financial year 2009-10. MTMF consider a growth of 6 percentage due to positive trend in export earning, a rose in production of aman and boro, increase in agriculture and industrial credit and finally the growth of imports of capital machinery and industrial raw materials. We will examine how increase in broad agriculture and service sector and increase in sub sectors of industrial sector lead to a positive growth in GDP at current market price. (According to BER GDP at market price is estimated TK 47405 which is 11.21% higher than GDP per capita of FY 2008-09). Moreover with a table of average change in the GDP (both current and constant), change in...
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...related to economic growth and unemployment? Basic Definitions A government's economic position is measured by the GDP (Gross Domestic Product). GDP is the total value of goods and services produced by an economy. When the GDP is positive then we can say that the country has an economic growth, when the GDP is negative then the country has an economic decline. When a government as a whole owes money then we say that there is a public debt, also known as a government debt. In order for the government to reduce this debt some actions have to take place such as increase taxes, cut spending and issue bonds. The government can increase the percentage rate of taxes in order to collect a greater portion of every single transaction...
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...policies, while necessary, can have negative and positive impacts on the economy’s production and employment rates. The information that I provide will be beneficial to understanding how to measure and determine economic health. Gross Domestic Product (GDP) is used to measure the business cycle, and both should be understood in order to determine how they work together. A business cycle is a period of time in the economy in which the economy is undergoing expansion and recession (Hubbard & O’Brien, 2010). When an economy, or when the business cycle is expanding, this means that there is an increase in production, which causes an increase in employment. The opposite can be said for a recession; production and employment will decrease. GDP is the value of goods and services that were produced in an economy, during a specific amount of time (Hubbard & O’Brien, 2010). The GDP is a quarterly report in which the government compiles the data of final goods and services purchased in the economy and calculates what the GDP is. The government is specific on what is accounted for in the GDP. First, only final goods and services are calculated; meaning that if company A and company B both produce two separate items that company C combines, only the final good/service from company C is calculated into the GDP. Also, the quantity of goods that are produced is not what is counted; the actual dollar value is what helps determine the GDP. The GDP provides a quarterly review to businesses that...
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...U.S. Military Spending and its impact on the Economy’s GDP Matthew Magana Abstract This paper examines whether increases in military spending have a positive or negative impact on the U.S. Gross Domestic Product (GDP). The paper focuses on the three North American economies: Canada, Mexico and the United States as models to develop a case. It will also illustrate the utilization of multiple economic tools to produce variable outcomes to analyze the full spectrum of economics. It will also discuss the multiple statistical models such as Granger causality and Vector autoregression and the asymmetric results produced. Increased U.S. Military Spending and its impact on the Economy Given the long-accepted, theoretical direct relationship between investment and economic growth, if defense spending has a negative impact on investment, then it would seem reasonable that defense spending would have an adverse impact on economic growth. This was exactly the findings of two studies published in the seventies, zymanski (1973) and Lee (1973). Some studies attribute the negative effect of defense spending on economic growth to reduced investment. Another study argues that defense spending restricts export growth and economic growth because military expenditures compete for the same resources used in the production of exports. Which may also be a understood trade off for military spending vs. export and economic growth. However, other studies were unable to find any stable...
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...REAL GDP IN THE U.S. (IN BILLIONS) 2004-2013 17,000.0 16,000.0 15,000.0 14,000.0 13,000.0 12,000.0 REAL GDP VALUE 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Since the two year drop in 2008 and 2009, real GDP has risen every year by at least 1.5%. This indicates the continued development and purchase of new domestic products, contributing to a healthier economy. The United States has seen growth for four straight years, and is going on it's fifth now. While its growth hasn't been as high as 2004-2007's has been, it's still an obvious marked improvement from the economic downturn of 2008 and 2009. REAL POTENTIAL GDP (IN BILLIONS) 2004-2013 17,000.0 16,000.0 15,000.0 REAL POTENTIAL GDP 14,000.0 13,000.0 12,000.0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Real potential GDP has consistently risen every year over the last ten years, including during the economic downturn of 2008-2009. A rise in real potential GDP generally indicates the economy is capable of producing more goods and services at their full potential every year. Real potential GDP tends to coincide with rises in real GDP. The United States is consistently rising in real potential GDP, and that indicates the economy has more and more economic potential every year. REAL GDP GROWTH (2004-2013) 4.00% 2.00% 0.00% -2.00% -4.00% REAL GDP GROWTH 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Real GDP growth is a percent change of how much real GDP has...
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...GDP Research Paper The definition of Gross Domestic Product (GDP) defines aggregate output as the dollar value of all final goods and services produced within the borders of a country during a specific period of time, typically a year, while the real GDP is the GDP that has been deflated or inflated to reflect changes in the price level (McConnell, C. (2011). Macroeconomics [VitalSouce bookshelf version]. Retrieved from http://online.vitalsource.com/books/1259174522/epubcfi/6/52). According to BEA, the growth of real GDP decreased one percent in the first quarter of 2014, in the fourth quarter of 2013, the growth of real GDP increased two point six percent (News Release: Gross Domestic Product. (n.d.). News Release: Gross Domestic Product. Retrieved June 23, 2014, from http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm). The trends in the growth of real GDP is very unstable. For example, in 2010, the GDP kept growing, but the extent seemed to become lower; The first quarter of 2011 was negative, but then the growth in real GDP became positive; In 2012, the growth in real GDP was always positive, merely the fourth quarter’s growth was hardly to be aware; 2013 was a very successful year, the growth in GDP was significant; Unfortunately, the first quarter in 2014 was negative. Things are little different in the corporate profits, it seemed that the profit in the first quarter of every year would always be negative. Corporate profits declined almost ten percent...
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...economy in a recent recession the level of unemployment rose. This affected millions of US citizens as well the US GDP levels. When citizens are out of work fewer products are being purchased and retail starts to decline. The US economy is slowly coming out of the financial crisis and recession within the last recent years. It wasn’t until the past year of 2011 did our economy see a positive turn around and unemployment levels began to decline. The Unites States economy has been showing increasingly positive signs throughout the year 2011. The unemployment rate fell recently in 2012 and is continuing to show good signs for a better economy. As of January 2012 the unemployment rate has fell to 8.3% in the Unites States. This is the lowest level the economy has seen since February 2009. Since August 2011 the unemployment rate has decreased by .8%. The widespread unemployment experienced in the last recent years is not the worst the US economy has ever experienced. The unemployment rate in the US averages 5.70 % from 1948 to 2010. The worse rate experienced was a record high for unemployment during November of 1982 with a 10.80% rate. There is hope though for the future with the unemployment rate slowly declining. In last several years the United States was experiencing a recession. The recession officially started in the first quarter of 2008. GDP levels fell rapidly at 1.8 %. During the recession in recent years there was a peak of 10.2 % unemployment rate...
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...the change in Gross Domestic Product (GDP) from years 1970-2000. GDP is a very important tool in measuring the economic condition of a country. When GDP is increasing from year to year, it would be safe to assume income, labor opportunities, and overall business would increase as well. I decided to discuss the change of GDP opposed to total GDP, for an understanding of the changes in the select macroeconomic variables that significantly affect GDP. The purpose of this study is to attempt to determine what factors affect the change in GDP, and what arrangements can be made to result in more accurate data. This can be helpful to any nation’s economy. If accurate results are found to determine what affects the change in GDP, then economic policies can be pursued and implemented to aid in the steady increase of a countries GDP. The change in GDP is not subject to any certain variables, for many variables affect the change in GDP. I chose three variables that I believe will have a considerable impact on the change in GDP: change in consumption, change in investment, and change in unemployment rate. It is apparent that consumption and investment are directly related in finding the total GDP. I believe the change in consumption to have a consistent positive relationship with the change in GDP; the more consumers spend the more likely GDP will increase. I believe change in investment will also provide a positive relation to change in GDP. A strong investment should provide...
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...Introduction The GDP is one of the primary indicators used to gauge health of country’s economy. In short it represents dollar value of all goods and services produced over a specific time period generally one year. GDP depends on a myriad number of factors and the purpose of our regression analysis is to study the variables that affect the GDP of nations. We have boiled down to a specific few variables which have major impact on GDP according to us. The variables and their effects have been covered in detail ahead. Reasons behind choosing the independent variables Our main independent variables are Literacy Rate, Economic Freedom Rating, Government Spending as percentage of GDP and Current Account Balance. Here is a brief rationale behind the choice. • Literacy Rate: Literacy rate is a direct indicator of the human resource capability of the country and is positively correlated with the productivity of the country’s labor force. GDP per capita is directly proportional to productivity of the labor force. Thus we considered literacy as a strong influencer of GDP per capita. • Economic Freedom Rating: The Index of Economic Freedom is a series of 10 economic measurements created by The Heritage Foundation and The Wall Street Journal. Its stated objective is to measure the degree of economic freedom in the world's nations. Empirical studies based on these rankings have found higher living standards, economic growth, income equality, less corruption and less political...
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...Cape Verde | “Most Improved Country” | | Introduction Cape Verde is a small country that spans ten islands and is 570 kilometers off the coast of Western Africa. There is very little rainfall per year and the land on most of the islands are of volcanic origin. On several of the islands the land is fairly flat, sandy and dry, whereas the rest of the islands are covered in rocky land. It, therefore, lacks in natural resources and has experienced severe droughts. Agriculture is made difficult by lack of rain and is restricted to only four islands for most of the year. It is ironic that the country is called “Verde” meaning “Green,” even though most of the land is not green. Due to the scarcity of agriculture, most of the nation's GDP comes from the service industry; more specifically tourism, light manufacturing industries, and fisheries. Cape Verde's economy has been steadily growing since the late 1990s, and it is now officially considered a country of average development. Through an economic analysis of Cape Verde, we will see the connections between its economy, society, and government. The analysis will recognize not only the flaws and struggles of the country, but will pose possible solutions to its problems. Government: Past and Present Learning about a country’s government is essential to figuring out their economic details. Uninhabited on their discovery in 1456, the Cape Verde islands became part of the Portuguese empire in 1495. Portuguese people began establishing...
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...regions become complicated. Under such circumstance, regional economy is no longer isolated but strongly related. The development of regional economy not only relies on its own endowment, also highly depends on the development of other regions This paper is going to bring relative spatial autocorrelation analysis and econometrics methods in the analysis of regional economic growth in China. It attempts to test the spatial dependence of economic growth among different provinces in China and its tendency. The inner mechanism of regional economic growth will also be discussed. In the second section, I will briefly introduce the literature review about regional economic study in China. In the third section, using a sample of per capita GDP data over 1978-2008 in 31 provinces in mainland China, I compute a global spatial autocorrelation, and use the local spatial autocorrelation to get general idea where this global spatial autocorrelation come from. In the fourth part, the spatial factors which influence regional economic growth will be tested. Conclusion will be included in the last section. 2. Literature review In China, the study of regional economic growth has attracted many attentions, but the study on regional correlation and disparity is usually made using traditional non-spatial analysis such as variation coefficient, Gini coefficient and so on (Xu et al,2005). However, at the regional scale,...
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...growth present an important question of what are the determinants and is there a role for stabilizing policy. Explain why the study is important. Why is economic growth so important? Coexistence of Growth miracles, Growth Disasters Barro (1991) provides that it is ultimately the relationship between the level of human capital and initial GDP that allows some poor countries to converge on rich countries. Ultimately, our conclusion parallels that of Barro’s and we find that the driving determinants of growth are Human capital, Investment and the initial GDP level. Our analysis follows the key ideas and assumptions of Barro’s model. We use both Primary and High School enrolment as a proxy for the accumulation of Human capital, however, this does pose some restrictions on our analysis. To examine this, a new index of human capital stock will be recommended. Most significantly… Summarise the findings of the paper. Our finding will ultimately accord with recent models such as Lucas [1988] and Romer [1990] that assume constant returns to reproducible capital. Although in these models the growth rate is independent of the starting GDP. We divorce...
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...Individual Project 1 1. Forecasting (a) Economic Growth: According to Bureau of Economic Analysis GDP increased by 2% in the first quarter of 2012 and by 1.3% in the second quarter. It is likely that this positive trend will be confirmed even in the 3rd quarter of this year. A possible estimate is the mean of the variations of GDP which occurred in the first two quarters of 2012. According to this reasoning GDP would increase by about 1.65% in the 3rd quarter. In order to support this estimate we can look at several significant indexes. For instance we can consider the Consumer confidence (this index is aimed at predicting consumption patterns). The figure related to September was 70.3 compared to 61.3 of the previous month. Therefore an increase in private consumption could lead to an increase of GDP. The increase in private consumption is not unreasonable. The average annual expenditure per consumer rose by 3.3% in 2011, slightly outpacing the 3.2% increase in CPI which occurred from 2010 and 2011. This is the first real rise in private consumption after 2007. So we can reasonably expect an increase in consumption expenditure even in 2012. Another meaningful index we can consider in our analysis is New home sales. The data for August was 373K compared to 374K of the previous month. So there is a slight downturn in purchased houses that could represent a reduced willingness to make investments. But at the same time I think that this decrease is too small...
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