The Reflection on Real Gross Domestic Product (GDP) Data
Question:
In what quarter did this economy enter a recession?
Answer:
Between quarter 7 and 8
Reflecting on the data provided, the economy entered a recession between quarter 7 and 8. This was identified based on the decrease in GDP from quarter 7 to quarter 8.
To calculate the recession, let's consider the GDP values in quarter 7 and quarter 8:
GDP in quarter 7 = $4,499 billion
GDP in quarter 8 = $4,409 billion
The growth rate of GDP in these two quarters can be calculated as:
Growth rate = (4409 - 4499) / 4499 * 100
= -2%
Based on the negative growth rate of -2%, it indicates a decrease in GDP, which signifies a recession. A recession occurs when the GDP of an economy experiences a decline, affecting various aspects of economic activity.