econ hmwk 1 - Chris Bennett Econ 1B Section 18 Woo Jung 1(i...

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Unformatted text preview: Chris Bennett Econ 1B Section 18 Woo Jung 1. (i) Residential Percentage of GDP 7.5 7 6.5 6 5.5 5 % of GDP 4.5 4 3.5 3 Residential % of GDP ? ? ? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ? ? ? 1950? ?? 1958? ?? 1966? ?? 1974? ?? 1982? ?? 1990? ?? 1998? ? ? ? 1954? ?? 1962? ?? 1970? ?? 1978? ?? 1986? ?? 1994? ?? 2002? Year The graph demonstrates that Residential Investment has fluctuated highly over the past 50 years. To some degree, the trend seems to be decreasing consistently to the 1990's despite peaks and valleys, but the last 20 years also seem to suggest consistent growth. There do not seem to be any immediate connections, although the fluctuations seem to mirror general economic health. (ii) The Relationship of Exports, Imports, and their Influence on GDP, 1950-2005 85 30 80 25 75 20 % of Goods in Exports % of Goods in Imports % of Sum of EX and IM in GDP 70 15 65 % of Goods in Exports and Imports 10 % of Sum of EX and IM in GDP 60 5 ? ? ? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ?? ? ? ? ? 1950? ?? 1956? ?? 1962? ?? 1968? ?? 1974? ?? 1980? ?? 1986? ?? 1992? ?? 1998? ?? 2004? ? ? 1953? ?? 1959? ?? 1965? ?? 1971? ?? 1977? ?? 1983? ?? 1989? ?? 1995? ?? 2001? ? Year This graph contains a good deal of interesting data on the relationship of Exports, Imports, and their role in GDP. While there have been dramatic fluctuations in all three series, there are consistent trends for each of them. While in the 1950s the U.S. had a positive net export balance, since then Imports have reliably increased following a steep decline in the 1960s, and Exports have on the whole decreased. These two things both correlate to the other series, which is that no matter the nature of the balance, that the total share of net exports in the GDP has been steadily increasing. (iii) State and Local v. National Defense Expenditures 70 65 60 55 50 45 40 35 30 25 20 % of Total Government Spending % State and Local % National Defense ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ? ? ? 1950? ? 1958? ? 1966? ? 1974? ? 1982? ? 1990? ? 1998? ? ? ? 1954? ? 1962? ? 1970? ? 1978? ? 1986? ? 1994? ? 2002? Year This graph shows two pretty obvious trends, as State and Local spending has increased relative to National Defense as percentages of Total Government Spending. The beginning of the graph shows remarkably high levels of Defense Spending, probably correlating with World War II and the Cold War. Meanwhile, since the late 1950s, State and Local Spending has increased. There seems to be an interesting inverse relationship between the two, in that they almost mirror each others as opposites. One can see the very recent increase in Defense in the 2000s, which follows a drop in State and local spending. (iv) Description: This chart seems to show the same relationship as described above but simply presents this in a different form. The scatterplot is useful in that it clarifies the correlation between the two factors. In this case it is interesting that there is a very precise inverse correlation between Local and State and National Spending (IE, as one goes up, the other goes down). This makes a lot of sense given the nature and limits of political spending, and since the scatterplot measures over all years, this correlation seems very consistent. Defense Relative To Local Gov't Spending 65 60 55 50 45 40 35 % State & Local 30 25 20 0 10 20 30 40 50 60 70 % National Defense 2. GDP in 1929: 1,570.5 (Billions of Chained/2000 Dollars) GDP in 2005: 10,913.8 G= (10,913.8/1,570.5)^(1/76)- 1 Where G= average annual growth rate. Thus G= .0258, Approximately 2.5% 3. PRS Number: 583625 ...
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