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Macro-economic data
Presented by:
Aman Singh
Shivani Karekar
Outline of the presentation
• GDP
• Cost of living
• Unemployment and employment
• India’s Fiscal deficit
• Debt trend
23-10-2018 Macroeconomics 2
GDP
• GDP is the monetary value of all goods
and services produced in the economy
in a given time period.
• Example: Bread and Gun
GDP= ( quantity of bread produced * price of bread ) + (quantity of guns produced *
price of guns )
23-10-2018 Macroeconomics 3
Types of GDP
23-10-2018 Macroeconomics 4
GDP
Nominal
Real
Actual
Potential
GDP Formula:
23-10-2018 Macroeconomics 5
Expenditure
Approach
Income
Approach
Production or
Value-Added
Approach
GDP= Consumption + Government Expenditure + Investments + Net Exports
GDP=Total National Income + Sales Tax + Depreciation + Net Foreign Income
GDP= Sum of the value added to products during production process
Calculation of GDP in India:
• Production or Value -added Approach
• Expenditure
23-10-2018 Macroeconomics 6
Fig.1 Value-added Approach Fig.2 Expenditure Approach
Economic activity
23-10-2018 Macroeconomics 7
Table -1
23-10-2018 Macroeconomics 8
Sector wise trend
23-10-2018 Macroeconomics 8
2016-17
Expenditure Method
23-10-2018 Macroeconomics 9
CIS-Change in stocks
Table 2
23-10-2018 Macroeconomics 10
Year Old definition & base(GDP growth %) New definition & base(GDP growth %)
2012-13 4.5 5.1
2013-14 4.7 6.9
Previous method vs Current method:
Parameters Previous Current
Price Cost of production Market price
Base year 2004-2005 2011-12
Table 4
Table 3
Results of the change:
• Reflects the current economic situation.
• Complaint with latest United Nation guidelines in System of National
Accounts.
• In par with international agencies like IMF, World Bank etc.
23-10-2018 Macroeconomics 11
Employment and unemployment trend:
• Labour force participation rate
LFPR=
𝑛𝑜.𝑜𝑓 𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑑 𝑝𝑒𝑟𝑠𝑜𝑛+𝑛𝑜.𝑜𝑓 𝑢𝑛𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑑 𝑝𝑒𝑟𝑠𝑜𝑛
𝑇𝑜𝑡𝑎𝑙 𝑝𝑜𝑝𝑢𝑙𝑎𝑡𝑖𝑜𝑛
*1000
• Worker population ratio
WPR=
𝑛𝑜.𝑜𝑓 𝑒𝑚𝑝𝑜𝑙𝑦𝑒𝑑 𝑝𝑒𝑟𝑠𝑜𝑛
𝑇𝑜𝑡𝑎𝑙 𝑝𝑜𝑝𝑢𝑙𝑎𝑡𝑖𝑜𝑛
*1000
23-10-2018 Macroeconomics 12
• Proportion unemployed
PU =
𝑛𝑜.𝑜𝑓 𝑢𝑛𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑑 𝑝𝑒𝑟𝑠𝑜𝑛𝑠
𝑇𝑜𝑡𝑎𝑙 𝑝𝑜𝑝𝑢𝑙𝑎𝑡𝑖𝑜𝑛
∗ 1000
• Unemployment rate
UR=
𝑛𝑜.𝑜𝑓 𝑢𝑛𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑑 𝑝𝑒𝑟𝑠𝑜𝑛
𝑙𝑎𝑏𝑜𝑢𝑟 𝑓𝑜𝑟𝑐𝑒
∗ 1000
23-10-2018 Macroeconomics 13
Approaches
• Usual principle status approach (UPS)
• Usual principal status and subsidiary approach (UPSS)
23-10-2018 Macroeconomics 14
Unemployment trend (India)
23-10-2018 Macroeconomics 15
Employment trend
23-10-2018 Macroeconomics 16
Major Employment sector in India
23-10-2018 Macroeconomics 17
Consumer Price Index (CPI)
• A statistical estimate of the level of prices of goods and services
bought for consumption purposes by households
• Macroeconomic indicator of inflation
• Calculation of CPI for multiple items
CPI for multiple items=
𝐶𝑜𝑠𝑡 𝑜𝑓 𝐶𝑃𝐼 𝑚𝑎𝑟𝑘𝑒𝑡 𝑏𝑎𝑠𝑘𝑒𝑡 𝑎𝑡 𝑐𝑢𝑟𝑒𝑟𝑛𝑡 𝑝𝑒𝑟𝑖𝑜𝑑 𝑝𝑟𝑖𝑐𝑒𝑠
𝐶𝑜𝑠𝑡 𝑜𝑓 𝐶𝑃𝐼 𝑚𝑎𝑟𝑘𝑒𝑡 𝑏𝑎𝑠𝑘𝑒𝑡 𝑎𝑡 𝑏𝑎𝑠𝑒 𝑝𝑒𝑟𝑖𝑜𝑑 𝑝𝑟𝑖𝑐𝑒𝑠
*100
23-10-2018 Macroeconomics 18
Market basket
23-10-2018 Macroeconomics 19
Groups for the revised CPI (Rural/Urban)
Groups Description
1. Food and Beverages
2. Pan, tobacco and intoxicants
3. Clothing and Footwear
4. Housing
5. Fuel and light
6. Miscellaneous(Transportation, Education, Personal care etc)
Wholesale Price Index(WPI)
23-10-2018 Macroeconomics 20
Trend of cost of living in India(2010-2018)
23-10-2018 Macroeconomics 21
Fiscal Deficit
• Total Government expenditure
more than the revenue
generated
• Debts and Deficits
• GFD= Expenditure- revenue
23-10-2018 Macroeconomics 22
Government Fiscal Deficit:
23-10-2018 Macroeconomics 23
Particulars 2016-17 (in Rs. billion)
Expenditure 19,752
Revenue receipts 13,742
Recovery of loans 176
Other receipts 477
Total Revenue 14,396
Fiscal deficit 5,356
Fiscal deficit
23-10-2018 Macroeconomics 24
Fiscal deficit
23-10-2018 Macroeconomics 25
Steps taken to reduce fiscal deficit
• Reduce Public Expenditure
• Increasing Revenue from Taxation
23-10-2018 Macroeconomics 26
India’s Debt and Trend
• Accumulated government deficits are called Debt
• India ranks 22nd in world with debt of $5290 Billion
23-10-2018 Macroeconomics 27
Internal debt
23-10-2018 Macroeconomics 28
External debt
23-10-2018 Macroeconomics 29
References:
• http://mospi.nic.in/
• https://courses.lumenlearning.com/boundlesseconomics/chapter/cos
t-of-living/
• https://tradingeconomics.com/
• http://www.mospi.gov.in/central-statistics-office-cso-0
• https://labour.gov.in/annual-reports
• https://data.worldbank.org/
23-10-2018 Macroeconomics 30
23-10-2018 Macroeconomics 31
Q & A
23-10-2018 Macroeconomics 32

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  • 2. Outline of the presentation • GDP • Cost of living • Unemployment and employment • India’s Fiscal deficit • Debt trend 23-10-2018 Macroeconomics 2
  • 3. GDP • GDP is the monetary value of all goods and services produced in the economy in a given time period. • Example: Bread and Gun GDP= ( quantity of bread produced * price of bread ) + (quantity of guns produced * price of guns ) 23-10-2018 Macroeconomics 3
  • 4. Types of GDP 23-10-2018 Macroeconomics 4 GDP Nominal Real Actual Potential
  • 5. GDP Formula: 23-10-2018 Macroeconomics 5 Expenditure Approach Income Approach Production or Value-Added Approach GDP= Consumption + Government Expenditure + Investments + Net Exports GDP=Total National Income + Sales Tax + Depreciation + Net Foreign Income GDP= Sum of the value added to products during production process
  • 6. Calculation of GDP in India: • Production or Value -added Approach • Expenditure 23-10-2018 Macroeconomics 6 Fig.1 Value-added Approach Fig.2 Expenditure Approach
  • 8. 23-10-2018 Macroeconomics 8 Sector wise trend 23-10-2018 Macroeconomics 8 2016-17
  • 9. Expenditure Method 23-10-2018 Macroeconomics 9 CIS-Change in stocks Table 2
  • 10. 23-10-2018 Macroeconomics 10 Year Old definition & base(GDP growth %) New definition & base(GDP growth %) 2012-13 4.5 5.1 2013-14 4.7 6.9 Previous method vs Current method: Parameters Previous Current Price Cost of production Market price Base year 2004-2005 2011-12 Table 4 Table 3
  • 11. Results of the change: • Reflects the current economic situation. • Complaint with latest United Nation guidelines in System of National Accounts. • In par with international agencies like IMF, World Bank etc. 23-10-2018 Macroeconomics 11
  • 12. Employment and unemployment trend: • Labour force participation rate LFPR= 𝑛𝑜.𝑜𝑓 𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑑 𝑝𝑒𝑟𝑠𝑜𝑛+𝑛𝑜.𝑜𝑓 𝑢𝑛𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑑 𝑝𝑒𝑟𝑠𝑜𝑛 𝑇𝑜𝑡𝑎𝑙 𝑝𝑜𝑝𝑢𝑙𝑎𝑡𝑖𝑜𝑛 *1000 • Worker population ratio WPR= 𝑛𝑜.𝑜𝑓 𝑒𝑚𝑝𝑜𝑙𝑦𝑒𝑑 𝑝𝑒𝑟𝑠𝑜𝑛 𝑇𝑜𝑡𝑎𝑙 𝑝𝑜𝑝𝑢𝑙𝑎𝑡𝑖𝑜𝑛 *1000 23-10-2018 Macroeconomics 12
  • 13. • Proportion unemployed PU = 𝑛𝑜.𝑜𝑓 𝑢𝑛𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑑 𝑝𝑒𝑟𝑠𝑜𝑛𝑠 𝑇𝑜𝑡𝑎𝑙 𝑝𝑜𝑝𝑢𝑙𝑎𝑡𝑖𝑜𝑛 ∗ 1000 • Unemployment rate UR= 𝑛𝑜.𝑜𝑓 𝑢𝑛𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑑 𝑝𝑒𝑟𝑠𝑜𝑛 𝑙𝑎𝑏𝑜𝑢𝑟 𝑓𝑜𝑟𝑐𝑒 ∗ 1000 23-10-2018 Macroeconomics 13
  • 14. Approaches • Usual principle status approach (UPS) • Usual principal status and subsidiary approach (UPSS) 23-10-2018 Macroeconomics 14
  • 17. Major Employment sector in India 23-10-2018 Macroeconomics 17
  • 18. Consumer Price Index (CPI) • A statistical estimate of the level of prices of goods and services bought for consumption purposes by households • Macroeconomic indicator of inflation • Calculation of CPI for multiple items CPI for multiple items= 𝐶𝑜𝑠𝑡 𝑜𝑓 𝐶𝑃𝐼 𝑚𝑎𝑟𝑘𝑒𝑡 𝑏𝑎𝑠𝑘𝑒𝑡 𝑎𝑡 𝑐𝑢𝑟𝑒𝑟𝑛𝑡 𝑝𝑒𝑟𝑖𝑜𝑑 𝑝𝑟𝑖𝑐𝑒𝑠 𝐶𝑜𝑠𝑡 𝑜𝑓 𝐶𝑃𝐼 𝑚𝑎𝑟𝑘𝑒𝑡 𝑏𝑎𝑠𝑘𝑒𝑡 𝑎𝑡 𝑏𝑎𝑠𝑒 𝑝𝑒𝑟𝑖𝑜𝑑 𝑝𝑟𝑖𝑐𝑒𝑠 *100 23-10-2018 Macroeconomics 18
  • 19. Market basket 23-10-2018 Macroeconomics 19 Groups for the revised CPI (Rural/Urban) Groups Description 1. Food and Beverages 2. Pan, tobacco and intoxicants 3. Clothing and Footwear 4. Housing 5. Fuel and light 6. Miscellaneous(Transportation, Education, Personal care etc)
  • 21. Trend of cost of living in India(2010-2018) 23-10-2018 Macroeconomics 21
  • 22. Fiscal Deficit • Total Government expenditure more than the revenue generated • Debts and Deficits • GFD= Expenditure- revenue 23-10-2018 Macroeconomics 22
  • 23. Government Fiscal Deficit: 23-10-2018 Macroeconomics 23 Particulars 2016-17 (in Rs. billion) Expenditure 19,752 Revenue receipts 13,742 Recovery of loans 176 Other receipts 477 Total Revenue 14,396 Fiscal deficit 5,356
  • 26. Steps taken to reduce fiscal deficit • Reduce Public Expenditure • Increasing Revenue from Taxation 23-10-2018 Macroeconomics 26
  • 27. India’s Debt and Trend • Accumulated government deficits are called Debt • India ranks 22nd in world with debt of $5290 Billion 23-10-2018 Macroeconomics 27
  • 30. References: • http://mospi.nic.in/ • https://courses.lumenlearning.com/boundlesseconomics/chapter/cos t-of-living/ • https://tradingeconomics.com/ • http://www.mospi.gov.in/central-statistics-office-cso-0 • https://labour.gov.in/annual-reports • https://data.worldbank.org/ 23-10-2018 Macroeconomics 30
  • 32. Q & A 23-10-2018 Macroeconomics 32