Measuring Economic Health Memo
Prepare a 350-700-word memo addressing the following:
a. Describe the use of Gross Domestic Policy (GDP) to measure the business cycle.
b. Describe the roles of government bodies that determine national fiscal policies.
c. Explain the effects of fiscal policies on the economy's production and employment. How do changes in government spending and taxes positively or negatively impact the economy's production and employment?
a. GDP is very important in measuring business cycles. The most common definition of a recession is two consecutive quarterly declines in the GDP (the total of all goods and services produced within a country). This definition may be considered as simplistic by many because it measures national economic performance according to a single, although important, economic statistic. In short, by looking at only one aspect of national economic activity—the GDP—an evaluation is made of the whole economy. Thus GDP is an important measure. However, it can lead to a wrong conclusion. A more detailed definition of a recession is the one used by the National Bureau of Economic Research (NBER), a nonprofit organization regarded as the official agency for the measurement of business cycles. According to the NBER, a recession is "a period of significant decline in total output, income, employment, and trade, ...
The solution discusses measuring a economic health memo within 350-700 words.