Check the Federal reserve Board's semiannual monetary policy reports to the Congress ((http://federalreserve.gov/boarddocs/hh). In these reports, which are published every year in February and July, the Federal reserve Board members provide economic performance forecasts.

Find the data for the following variables and evaluate Fed's forecasting: In July, 2009, the Federal Reserve Board's projections for the year 2010 were:

Real GDP growth:

Inflation:

Unemployment rate:

The March, 2011 report lists the actual numbers that were observed during 2010, namely:

Real GDP growth:

Inflation:

Unemployment rate:

Using this information, answer the following questions:

a. how well did the Fed anticipate the economic performance of 2010?

b. explain why economic forecasts are not totally accurate