Economic Growth Of A Recession

1433 Words Feb 8th, 2016 6 Pages
A recession can be defined as an economic decline in gross domestic product, in which, a nation experiences a downward sloping growth rate. Additionally, recessions tend to have a time range of two or more periods/quarters of falling real gross domestic product (GDP), consequently from the negative sloping economic growth rate. In order to properly define causal factors of a recession, it is most appropriate to elucidate what GDP’s meaning.
GDP = I + C + G + NE
GDP provides a monetary value of all final goods and services produced within a nation in a particular year. The independent variables make up the GDP, which is comprised of the sum of investments, consumption, government spending, and net exports. A strong GDP is a good representation because it indicates a nation’s viability. It is rather pertinent for a nation to be able to forecast the economy and know where along the business cycle the economy is headed. There are multiple macroeconomic indicators that are analyzed to make lucid a nations economic condition, such as foreign direct investments, oil prices, and employment. In this paper, we will be analyzing the causal relationship between interest rates and recessionary periods, pertaining particularly to The Russian Federation.
Based on the graph below (See Russian GDP Growth), one can discern that Russia began to experience fluctuation in their GDP at the start of 2008. Zeliko Bogetic states in the article Russia: Reform After the Great Recession, this…
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