Guidelines for the Assignment:

 The following are key areas to discuss and you can organize your essay around

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these areas using the tools (including graphs) and concepts learned in this course:

 Overview – identify the key macroeconomic indicators to be discussed in

the essay; brief overview of the theoretical relationship between selected


 Empirical analysis – based on actual data (of a country), discuss the

relationship between macroeconomic indicators preferably using graph

and other statistical tools (such as correlation coefficient, regression);

discuss whether the relationship is positive, negative or ambiguous;

discuss any interesting observation or trend

 Conclusion – any concluding remarks about findings and what policy

implications it offers

Potential Macroeconomic Indicators for Analysis (some of those that we discuss in


 Consumption, Investment, Government Spending and Exports

 Real GDP, Nominal GDP and GDP Deflator

 Consumer Price Index and Producer Price Index

 Unemployment rate and Labor Force Participation rate

 Money Growth and Inflation

 Inflation and Unemployment

Some potential macroeconomic issues for analysis:

 Does higher GDP growth leads to lower unemployment?

 Does higher inflation leads to lower GDP growth?

 Does higher exports leads to higher GDP growth?

 Does higher money growth leads to higher inflation?

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