. It is important to evaluate the historical relationship between variables in order to explain how one indicator or variable may impact another. With this in mind, what sources will you use to obtain historical data for the economic indicators that you have selected? Why do you think that professional forecasters rely so heavily on past data and trends?
I will pull the historical data from the following websites: Bureau of Labor Statistics (http://stats.bls.gov/), the U.S. Department of Commerce Bureau of Economic Analysis (http://www.bea.doc.gov/), the U.S. Department of Commerce Economics and Statistics Administration (http://www.esa.doc.gov), the Federal Reserve (http://www.federalreserve.gov/).
The future of the economy, weather it will be good or bad is determined has been determined for many years by the economic indicators. For this reason professional forecasters rely economic indicators for firms decision making and for investing.
An economic indicator is simply any economic statistic, such as the unemployment rate, GDP, or the inflation rate, which indicate how well the economy is doing and how well the economy is going to do in the future. As shown in the article "How Markets Use Information To Set Prices" investors use all the information at their disposal to make decisions. If a set of economic indicators suggest that the economy is going to do better or worse in the future than they had previously expected, they may decide to change their investing strategy. In short, forecasters’ words—and numbers—have major influence on the decisions, and ultimately the fortunes, of many.