Business environment Assignment

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Question 1

Data on Gross Domestic Product from1930 to 2006 was taken from the Bureau of Economic Analysis website (Bureau of Economic Analysis . Gross Domestic Product was used as an indicator of economic growth since economic growth is primarily determined by output and changes in output which is reflected in GDP and changes in the GDP

It is clear from the data that from the

1930s to 2006 that from the 1930s to the 1950s , there were large fluctuations in GDP growth . Large spikes and falls characterize the pattern of GDP growth during that period , as we can see by graphing the GDP growth data for that period For example , from the numerical data in the table , we see that the GDP growth rate within the specified period ranged from -13 .0 to 18 .5 which were definitely large fluctuations

Furthermore , the economy was in constant flux from growth to recession For example , from 1930 to 1933 , GDP growth was negative , followed by a sudden burst of growth at 10 .8 in 1934 from a recession of -1 .3 in 1933 . This growth continued unabated till 1944 , with the exception of 1938 which experienced a significant recession of -3 .4 . During 1944 the economy plunged back into recession , probably due to the outbreak of WW2 . This recession continued till 1949 , with 1948 posting a growth of 4 .4

We can then conclude that the period of 1930s to the 1950s was one of large fluctuations in GDP growth in the United States . The depression from the start of the 1930s was due to The Great Depression ( Great Depression in the United States , 2006 , with the second marked depression from 1944 being due to the start and continuation of World War 2 , which undoubtedly hurt international trade , and then domestic production as resources shifted towards producing wartime equipment

After the 1950s , there were hardly any recessions or negative growth in GDP , except for a few occasions , such as that in 1954 (-0 .7 , 1958 (-1 (Eisenhower , 2006 , 1974 (-0 .5 ) and 1975 (-0 .2 . However , there was also no longer the double digit percentage growth in GDP which could be found in the 1930s period , such as 10 .8 in 1934 , 13 in 1936 , and impressively , a staggering 17 .1 in 1941 , 18 .5 in 1942 and 16 .4 in 1943 . In contrast , GDP growth from the 1950s onwards averaged between 8 .7 in 1950 , and 0 .8 in 2001

So in summary , we can see that GDP growth had huge variation between high levels of growth from 18 .5 in 1942 to a recession of -13 in 1932 during the 1930s , marking an era of economic instability and wild fluctuations . On the other hand , we have a period of relatively stable economic growth , marked by a few years in between of mild recession between...