I have graphed the real GDP growth over the years 1990-2004.

I need help analyzing it! What happened when it was going down? What happened when it shot back up again? HELP!

Thanks...

The GDP growth rate went down considerably during the period 2000-2002, becoming slightly negative in 2001. This was a reaction to the collapse of the stock market, and in particular technology and internet-related stocks. There has been real GDP growth on other years of the period 1990-2006, but it has been less since 2002 than it was in the 1990's. The recovery in GDP growth rate since 2002 is attributable to the low-interest rates promoted by the Federal Reserve and the continued benefits of USA productivity imporovement, once the stock market (especially NASDAQ stocks) stabilized in value

To analyze the trend of the real GDP growth, you first need to understand the factors that influenced the changes during the period you mentioned.

When the GDP growth is going down (2000-2002):
1. The collapse of the stock market: The steep decline in GDP growth during this period was largely fueled by the bursting of the dot-com bubble. Many technology and internet-related stocks experienced a sharp decline, leading to a decrease in overall economic activity.
2. Decreased consumer and business spending: The decline in stock prices resulted in a decrease in consumer and business confidence, leading to reduced spending. This further contributed to the decrease in GDP growth during this period.

When the GDP growth shot back up (post-2002):
1. Low-interest rates: In response to the economic downturn, the Federal Reserve implemented a policy of lowering interest rates. This move aimed to stimulate borrowing and investment to boost economic activity and increase GDP growth.
2. Stabilization of stock market: Once the stock market, especially NASDAQ stocks, stabilized and began to recover, investor confidence improved. This, in turn, led to increased economic activity and contributed to the subsequent improvement in GDP growth.
3. Continued productivity improvement: The benefits of increased productivity, which had been a contributing factor to economic growth in the previous decade, continued to support GDP growth even after the downturn. This ongoing productivity improvement helped propel GDP growth rates to recover and increase beyond the earlier low levels.

When analyzing the graph, you can look at the specific years and the patterns of change in the GDP growth rate. Consider evaluating the contributing factors discussed above to understand the reasons behind those changes. Additionally, you may want to compare the GDP growth rates during this period to historical averages or other periods to gain further insights into the overall economic performance.