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Economics Analytical paper...

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27 April 2017 Mushrush Analytical Paper Part 2 1. In March 2017, the CPI was 243.801, and the rate of inflation was .08128 2) For 2016, the GDP was $18,450.1 billion in the second quarter. In the third quarter, GDP was $18,675.3 billion. And in the fourth quarter of 2016, the GDP was $18,869.4. Net exports in quarter two to three increased .2%, resulting in -2.5% Investment and personal consumptions also increased .2% which are now 16.4% and 68.9% from quarters three to four. Quarter two to three also faced decreases from personal consumption by .1 resulting in a 68.7%, and a decrease from government consumption by .1, resulting in a 17.6%. Quarter three to four faced decreases from net exports by .4, resulting with a -2.9%. Government consumption decreased by .1 leading to a 17.5%. The GDP deflator for two, three, and four were: 111.258, 111.648, and 112.229. 3) The Federal Open Market Committee decided to change the FFR target range from ¾% to 1% in March. 4) I think the Feds chose to increase the FFR because GDP has continued to grow throughout the duration of the four quarters. According to the Bureau of Economic Analysis, an increase in domestic purchases results in banks loaning out more money than normal, and there was an increase in domestic purchases in the fourth quarter. Also, since GDP continues to grow, the value of money will decrease, and prices will increase because consumers will feel they have more purchasing power

Sources https://fred.stlouisfed.org/series/GDP#0 https://fred.stlouisfed.org/series/DPCERE1Q156NBEA https://fred.stlouisfed.org/series/GDPDEF/

https://www.bls.gov/cpi/cpid1703.pdf https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20170315.pdf https://www.federalreserve.gov/monetarypolicy/files/fomcminutes20170315.pdf...