REVIEW OF BASIC MATHEMATICAL AND STATISTICAL CALCULATIONS

The following questions area review of some of the mathematical and statistical calculations you have learned in previous courses. We will use your answers as the beginning point for EC 334 and as the basis for learning the fundamentals of Excel.

An electronic version of these questions is available on the course web page: http://employees.csbsju.edu/mlewis/EC334/Home.htm.

One of the data series frequently used by economists is the Gross Domestic Product and its components.

  1. Identify two (2) questions which economists might answer using GDP data.
  2. Use the following data (obtained from http://www.bea.gov/bea/dn1.htm) to calculate the requested GDP statistics. NOTE: All data is in billions of dollars and is seasonally adjusted at annual rates.

    Year-Quarter

    GDP

    Personal Consumption Expenditures

    Gross Private Domestic Investment

    Government Purchases of Goods and Services

    Net Exports

    2001-I

    10028.1

    6904.7

    1671.1

    1825.0

    -372.7

    2001-II

    10049.9

    6959.8

    1597.2

    1858.5

    -365.7

    2001-III

    10097.7

    6983.7

    1574.9

    1851.7

    -312.6

    2001-IV

    10152.9

    7099.9

    1500.7

    1896.8

    -344.5

    2001 Annual Average

    Annual Average as a Percentage of GDP

    Standard Deviation

    Percentage Change between Q1 and Q4
  3. From the calculations, answer the following questions. Be sure to explain how you arrived at your answers.
    1. Which component of GDP was the largest, on average, during 2001? Which was the smallest?
    2. Which component was the most volatile during 2001? Which was the least volatile?
    3. Which component experienced the largest growth during 2001? Which experienced the least?
  4. For each answer in question 3, discuss how you might "show" your answers by using a graph or other pictorial representation.
  5. The above data is in nominal terms. Explain what that means, and discuss if this is the appropriate data series for the above calculations.