ECONOMIC INDICATORS FORECAST

Real GDP: Real GDP is nominal GDP adjusted for price-level changes (inflation). Real GDP is calculated in relation to a base year. Nominal GDP is adjusted for price-level changes between the base year and the current year through the application of a GDP-deflator (the assumption is that price levels increase; should price levels decrease, the adjustment measure would be a GDP-inflator). GDP typically is measured in terns of rate of change for purposes of analysis. The rate of change is from immediate prior period to current period (Eun & Resnick, 2004).

Unemployment Rate: The unemployment rate reflects the percentage of the non-institutionalized workforce that is considered to be unofficially unemployed at a specified time. The United States government considers people to be officially unemployed if they are (a) classified as "insured" (eligible for federal unemployment benefits) and are actively seeking work. Thus, many persons who are among the long-term unemployed and have given up any hope of obtaining employment through state employment offices are not counted among the unemployed (Mastrianna & Hailstones, 1995).

Inflation Rate. The rate of inflation is defined in this p

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+3.20% 2005-4 +3.50% +3.20% 2006-1 +3.50% +3.20% 2006-2 +3.40% +3.30% 2006-3 +3.40% +3.00% 18-Month +5.24% +4.84% The forecast issued by the Mortgage Bankers Association is more optimistic than is the forecast issued by Wachovia Bank. The reconciliation of the differences between the forecasts indicates that the Mortgage Bankers Association is much more optimistic about personal consumption and business investment than is Wachovia Bank, while Wachovia is somewhat more optimistic about residential investment and government expenditures than is the Mortgage Bankers Association. The lower forecast by Wachovia Bank appears to this writer to have greater predictive accuracy. Actual growth reported in the American economy appears to be growing at a slower rate over the past two quarters. Unemployment Rate The 18-month forecast period is 2nd Calendar Quarter 2005 (April-May-June 2005) through 3rd Calendar Quarter 2006 (July-August-September 2006). The forecasts were issued by the Mortgage Bankers Association (2005) and Wachovia Bank (Silvia, Bryson, & Vitner, 2005). The forecasts are presented in terms of the projected level of the unemployment rate by calenda
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Some common words found in the essay are:
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