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Understanding the U.S. Economy: Insights and Analysis

Explore the nuances of the American economy, from GDP to inflation rates, and learn about government policies impacting businesses and consumers. Dive into economic indicators, business cycles, and more.

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Understanding the U.S. Economy: Insights and Analysis

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  1. American Business Leslie Lum Bellevue College

  2. Icebreaker

  3. Brainstorming • Brainstorming is a group technique to generate as many ideas as possible. We are going to brainstorm in groups about: What is a business? • What is the context of a business? What environment does it operate in? • Form a group • Brainstorm what a business is • Draw a picture of your ideas • Report back to the class

  4. What is the economy?

  5. Part of the U.S. economy? • Building a house in New Mexico • Toyota cars assembled in Kentucky • Hair salon in South Dakota • Seattle SuperSonics • Coca Cola plant in China

  6. Who wants to be a millionaire-- What is the size of the US economy? How does it compare to the rest of the world? http://www.worldbank.org/data/quickreference/quickref.html

  7. Relative GDP (Nominal vs PPP)(wikipedia.com)

  8. GDP per capita (person)(wikipedia.com)

  9. Measuring the economy Value of goods and services are totaled. GDP adjusted for inflation. Growth is graphed.

  10. The rate of change of GDP • Growth • Period of Expansion • Contraction • Recession

  11. REAL GDP http://www.whitehouse.gov/fsbr/esbr.html

  12. Change in Real GDP

  13. Inflation • Increase in the price of goods and services • How do we measure it? • Is it good or bad? • What has been the inflation rate for the past 30 years?

  14. What consumers spend http://nytimes.com/interactive/2008/05/03/business/20080403_SPENDING_GRAPHIC.html

  15. Consumer Price Index http://www.bls.gov/cpi/home.htm#tables

  16. Inflation

  17. Inflation

  18. How does the US compare? http://www.nationmaster.com/graph-T/eco_inf_rat_con_pri

  19. Role of Government • Monetary Policy - Federal Reserve sets interest rates • Fiscal Policy - Spending to stimulate economy

  20. Can the Government afford to help?

  21. Can the Government afford to help?

  22. Monetary Policy - How it works

  23. The Whole Picture • The Business Cycle is crucial to business planning

  24. How to avoid finding yourself in the middle of a recession • Important to look ahead • Predict upturns and downturns

  25. Economic indicators • Construction • Manufacturers’ shipments, inventories, orders • Employment • Consumer credit • Wholesale trade • Capacity

  26. GDP Output by Industry

  27. Not all industries are growing or contracting at the same rate

  28. Shifts in the American Economy • Where should you be?

  29. Key terms to analyze and know (as on test) • Economy • GDP, Real GDP growth • GDP per capita • Inflation (Consumer Price Index) • Business Cycle (expansion, contraction, peak, trough) • GDP output by industry • Economic indicators

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