Retail Sales Performance
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Retail sales are a closely watched economic indicator because of the magnitude of the proportion of gross domestic product (GDP) reflected in the retail sales measure. Consumer spending (the bulk of which is represented by retail sales) accounts for approximately two-thirds of GDP. Therefore, a deteriorating trend in retail sales will be a cause for concern by economists, government leaders, business leaders, and consumers because the trend may indicate that the economy is either (a) heading for recession or (b) already has entered recession. Conversely, an upward trend in retail sales may be a cause for optimism (it will not be a cause for alarm) by economists, government leaders, business leaders, and consumers because the trend may indicate that the economy is (a) functioning efficiently or (b) is poised for strong growth. If the upward trend in retail sales is too strong, however, there may be a concern that undesirable levels of price inflation may be in the offing; a concern that could trigger action by the Federal Reserve Board to moderate the potential for the development of higher than desired levels of price inflation. The typical response by the Federal Reserve Board in such scenarios is to raise interest rates.Retailers tend to measure same store year-to-year performance for stores that have been operating for at least one year because such measures provide them with indications of (a) how well their strategies are working in establishe
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Some common words found in the essay are:
Department Commerce, , Reserve Board, Effect Chart, retail sales, department commerce, newly-opened stores, characterized price elasticity, price elasticity demand, trend retail sales, elasticity demand, trend retail, year-to-year performance, consumer spending, wealth effect, price elasticity, dollar value, Federal Reserve, value product sales, North-Holland Publishing, dollar value product,
Approximate Word count = 850
Approximate Pages = 3 (250 words per page)
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