BLOOMBERG QUESTIONS & ANSWERS RATED 100% CORRECT!!

How accurately do GDP statistics portray the economy and why? - Answer-Just because they are official and numerical does not mean they are accurate. The term "domestic" in GDP unambiguously links to a nation state. Why is economic data helpful in the investment process? - Answer-If an economy is doing well then certain companies will sell more of their product as household budgets also increase. What 5 data inputs matters most to investors? - Answer-Economic growth, inflation, unemployment, business confidence, and housing. How do you calculate GDP? - Answer-GDP= C + I = G + (X-M). C= Personal consumption. I= private investment. G= government consumption. X= exports. M= imports. (X-M)= net exports. nominal growth (growth rate) - Answer-increases in production and increases in price real GDP - Answer-isolates increases in production If growth rate (nominal GDP) = inflation rate, then... - Answer-real growth rate is at zero. If Nominal GDP rate inflation rate, then... - Answer-Real Growth Rate is positive. Is the economy cyclical? - Answer-Yes, there are quarters of growth and recession. Recession - Answer-two successive quarters of negative real GDP growth Inflation (CPI) - Answer-unveils the real growth in the economy. It can erode the value of bonds. It means that a unit of money tomorrow buys less than the same unit of money would buy today. This accounts for the rising cost of living. Increase in prices of goods and services that diminishes purchasing power of money.What are the two sources for inflation reports? - Answer-GDP Report: based on whole economy. Consumer Price Index: based on representative basket of goods, and services, like food, housing and automobiles How does time change representative inflation baskets? - Answer-With changes in technology. Like DVD players are replaced with online streaming. If nominal GDP growth line or percentage is less than the real GDP, then... - Answer-there is deflation. Why is unemployment so important to the US economy? - Answer-The fact that the US is largely a consumer economy leads to the tight connection between US employment and US GDP. An overall increase in unemployment depresses GDP growth. When the economy shrinks, employment declines. Nonfarm payrolls - Answer-measure the change in the number of people with jobs and during a recession, this goes down. This is the unemployment report.