Tools To Measure Economic Progress Of A Country
Economic growth is the increase in the Inflation- adjusted market value of Goods and Services produced by an economy over time. It is conventionally measured as the percentage of increase in Real Gross Domestic Product (GDP). Economic reports and indicators provide measurements for evaluating health of our economy, latest business cycles and how customers are spending and generally faring.
Given below are Nine points common and vital economic indicators for experts to judge and draw opinions from:
1) M2 (Money Supply) - Does not include Institutional Money Fund Assets, large denominated Time Deposits or Special Reserves Banks required to make. Data released by Reserve Federal System is used to assess current economic and financial conditions and to help alter its Monetary Policy which includes raising and lower interest rates.
2) Real GDP (Gross Domestic Product) - Real GDP is a comprehensive way to gauge the health and well-being of an economy.It is the market value of all goods and services produced in the country during a specific time period. It measures society's wealth by indicating how fast profits may grow and the rate of return on capital. It is "Real" because each year's data is adjusted to account for changes in year-to-year prices.
3) Consumer Price Index (CPI) - It does not include every item an individual may buy, instead takes a sampling of hundreds of goods and services across 200 items It does not include income, taxes or investments in stocks bonds or life insurance but includes sales tax on goods and services. It is the best indicator of inflation.
4) Producer Price Index - It measures prices in three stages of production - Crude goods, Intermediate goods and Finished goods in all sectors of production.
5) Current Employment Status - It indicates well being of economy and labor force. Indicators of how tight is the labor market which translates into wage inflation.
6) Retail Trade and Food Service Sales - Based upon random sampling, of Retail and Food service items, it measures consumers' personal consumption across retail industries and track the growth of spending.
7) New Residential Status - It is highly sensitive to change mortgage rates which are affected by changes in interest rates.
8) Manufacturing , Trade Inventories and Sales - It is the prime source of state of business inventories and sales inventory rates, provide clues about growth and contraction of economy. Growth in inventories means sales are slow and economy rate of growth is slowing.
9) S & P 500 Stock Index - The index is designed to measure changes in stock prices of component companies. It is used as a measure of Nation's stock of capital, as also to gauge the future business and consumer confidence levels. Growth of S & P 500 Index translate into group of business and declining can signal a tightening of belts for both business and consumers.
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Given below are Nine points common and vital economic indicators for experts to judge and draw opinions from:
1) M2 (Money Supply) - Does not include Institutional Money Fund Assets, large denominated Time Deposits or Special Reserves Banks required to make. Data released by Reserve Federal System is used to assess current economic and financial conditions and to help alter its Monetary Policy which includes raising and lower interest rates.
2) Real GDP (Gross Domestic Product) - Real GDP is a comprehensive way to gauge the health and well-being of an economy.It is the market value of all goods and services produced in the country during a specific time period. It measures society's wealth by indicating how fast profits may grow and the rate of return on capital. It is "Real" because each year's data is adjusted to account for changes in year-to-year prices.
3) Consumer Price Index (CPI) - It does not include every item an individual may buy, instead takes a sampling of hundreds of goods and services across 200 items It does not include income, taxes or investments in stocks bonds or life insurance but includes sales tax on goods and services. It is the best indicator of inflation.
4) Producer Price Index - It measures prices in three stages of production - Crude goods, Intermediate goods and Finished goods in all sectors of production.
5) Current Employment Status - It indicates well being of economy and labor force. Indicators of how tight is the labor market which translates into wage inflation.
6) Retail Trade and Food Service Sales - Based upon random sampling, of Retail and Food service items, it measures consumers' personal consumption across retail industries and track the growth of spending.
7) New Residential Status - It is highly sensitive to change mortgage rates which are affected by changes in interest rates.
8) Manufacturing , Trade Inventories and Sales - It is the prime source of state of business inventories and sales inventory rates, provide clues about growth and contraction of economy. Growth in inventories means sales are slow and economy rate of growth is slowing.
9) S & P 500 Stock Index - The index is designed to measure changes in stock prices of component companies. It is used as a measure of Nation's stock of capital, as also to gauge the future business and consumer confidence levels. Growth of S & P 500 Index translate into group of business and declining can signal a tightening of belts for both business and consumers.
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