Measuring Economic Health Memo

ToFromCCDateSubject How gross domestic product is apply to measure groove wheel aroundBusiness cycles are frugal fluctuations . Business cycle phases include the niche , depression , reaping , and expand . Recession and depression phases are characterized by measly production , decrease in investments decrease in gross domestic product , and adjoin of unemployment . Economic fluctuations match to concern changes . Growth and boom phases are characterized by suppuration in gross domestic product , append in employment and investments- sparing indicators are desirable . GDP is integrity of the economic indicators that are used to conciliate at which business cycle phase an scrimping is at and is heading to . GDP is commonly used to monitor short-run changes in the economy since it is the most door-to-door measure of ec onomic activity It measures goods and serve produced within a country at a specify period , usually one year . Growth in GDP leads to join on in per capita income . When per capita income increases economic agents purchasing berth bequeath increase .

This leave alone increase demand for goods and serve in the market . Increase in demand is a salient relief to the business . In case the GDP travel , it means that per capita income will reduce the economic agents will put on tight budget constraints , decrease their consumption which will risk demand for goods and services . This will adversely affect the business o perations . Investments are likely to reduce! and numerous businesses leave from operations (Mankiw 2008740Role of Government bodies that Determine national financial policiesGovernment bodies that determine national fiscal policies has...If you want to get a copious essay, order it on our website: OrderCustomPaper.com

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