Consumption of durables is more variable relative to trend than consumption of semi-durables, and consumption of semi-durables

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Consumption of durables is more variable relative to trend than consumption of semi-durables, and consumption of semi-durables is more variable relative to trend than con-sumption of nondurables and services. Speculate on why we observe these phenomena, and relate this to the key business cycle facts in Tables 3.1 and 3.2.

Table 3.1 Correlation Coefficients and Variability of Percentage Deviations from Trend Correlation Standard Deviation Coefficient (% of S.D. of GDP) Consumption 0.78 76.6 Investment 0.85 489.9 Price Level -0.19 56.3 Money Supply Employment Average Labor Productivity 0.20 81.0 0.80 63.0 0.80 62.4 Table 3.2 Summary of Business Cycle Facts Variation

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Macroeconomics

ISBN: 978-0133847147

5th Canadian edition

Authors: Stephen d. Williamson

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