- GDP (current US$) – this refers to the monetary value of all goods and services that are produced in a country within a certain period of time. The Canadian GDP is used as the basis for measuring or providing a snapshot of the economy by estimating its growth rate. It is based on its income, production, or expenditure rate (Disha, 2020). From the statistical information collected, the Canadian GDP (Gross domestic product) was found to be 2 trillion.
- Population- this refers to the total number of people that are registered within the country. In Canada we have 38 million people as at the census that was collected within the year 2020
- GDP per capita (current US$) – this refers to the gross domestic product of a country. It measures the economic output of the country as per the number of people. It is computed by dividing the GDP with the total population (Barro, 2008). Therefore, the GDP per capita of Canada is $ 1.713 Trillion
- Literacy rate, adult – this is the education measure of individuals who are aged 15 years and above. The literacy rate of Canada as at the year 2020 was found to be 48%
- Life expectancy at birth, female, Life expectancy at birth, male = life expectancy measures the time an organism is anticipated to live basing that duration on its current age as well as other demographic factors such as gender. In Canada, the data collected indicates that it has a life expectancy rate of 82 %
- Fertility rate, total = fertility rate refers to the number of children that are born by each woman (Gilliard et al., 1995). As at 2020, the fertility rate of Canada was 74%
- Inflation = this is the quantitative measure of the price of goods and services that are produced in the country within a certain period of time. The rise in its prices is the one that is perceived to have the propensity of affecting its supply in the market (Vroman&Brusentsev, 2005). As at the year 2020, the inflation rate of Canada was found to be 0.61%.
- Unemployment = this refers to the number of people who are willing and ready to take any kind of job that is available but they are not able to find any job (Barro, 2008). As at the year 2020, the Canadian unemployment rate was found to be 7.47%
- Poverty headcount ratio at $1.25 a day (PPP) (% of population)- as at the report that was published in last year, the Canadian poverty rate was found to be 0.15%.
- One additional indicator of your choice. NDP (net domestic product) - this refers to the annual measure of the country’s output that is aimed at adjusting the account of depreciation rate (Disha, 2020). As at the information collected in the year 2020, the Canadian NDP was found to be 1.643%
Give a brief explanation why you find this indicator interesting.
From the information collected above, the reason as to why these indicators are interesting is because they are the ones that highlight the wellbeing of the country. Taking into consideration the gross domestic product is paramount in estimating the propensity of the country to produce goods and services that meets the demands of the people. In case the country’s productivity decrease, it implies that the wellbeing of the state will also decrease. Inflation is another factor that is perceived to have the likelihood of increasing the rate of unemployment. Despite that, the economic the compositions of GDP simplify the rate the economic growth of the country. The living standards of the Canadian people will have to be based on the various forces of demand and supply (Fitz & Economic and Social Research Institute (Dublin), 2003). The increasing supply of products and service is the one that is perceived to have the likelihood of stimulating the economic wellbeing of the country.
The decline in the economic growth of the state could have been fostered by the competitions that exist in the modern country. In computing the gross domestic product of the decline of the economic growth could have as a result of the rate of demand and supply. The main forces of demand that are used in the modern market economy include supply and demand, government expenditures, speculations and expectations, and international transactions. Therefore, the rate of rate of development of the state is depended on the productivity rate of the country (Nallari at al., 2011). The expenditure of the state is one of the powerful strength for indicating the dependency rate of the state. The unemployment rate of the state is the one that is based on the literacy level of each individual.
Canada has trade agreements with over a half of the world countries. As the 11th biggest economy in the world its share of exports to the global market has decreased from 4.5% to 2.5% over the last 15 years as it enters into more and more free trade agreements. For example, in 2014 the country signed a milestone agreement with the European Union. Another factor that has impacted investment in the country is the availability of labor (Artis, 1982). The number of factory workers has been declining at an alarming rate. For example, the total number of factory workers in the country in 2014 was 1,710,900, the lowest since 1976. The lack of labor has severely impacted Canada’s manufacturing capabilities.
Among the monetary policies implemented by the country include: target for the overnight rate, short term interest rates, and flexible exchange rates, having stable banks, and controlling inflation. Among the stabilizers the country has built into its economy is reducing inflation below the 2 percent target. The country is also ready for supply shocks by stimulating demand in the instances where demand falls. However, the main stabilizers include tax revenues and employment insurance payouts. Canada’s public debt is approximately CAD$768 billion. It is 34% of the gross domestic product of the country. The public debt is as a result of the shortfall in tax collections against government spending. The banking system in Canada is mostly stable owing to the strong guidance of the central bank. It is one of the safest in the world with Canada’s banks ranking among the top banks in the world. For instance, the Royal Bank of Canada and the Toronto Dominion Bank rank in the top 20 banks in the world (TEXTBOOK, E. Q. U. I. T. Y. E. D. I. T. I. O. N., 2014). The central bank plays a crucial role in creating a stable environment in the banking system and the overall economy. Canada’s central bank, Bank of Canada, sets monetary policy and other measures to control inflation and preserve the value of money. Among the key indicators the central bank looks at to measure the health of the economy includes the consumer price index (CPI), inflation, and the CPI-trim.
Canada’s fiscal policy has evolved since the 1930s. With the assistance of the monetary policy it aims at keeping prices stable. The fiscal policy balances the budget of the country where the Canadian government has to act prudently just as the households. Over the years Canada’s fiscal policy has had to respond to tax shortfalls and decreases and low economic activity to lower the impact on the economy (McEachern, 2012). Canada’s ability to keep the value of its money stable provides the backing. Money is a legal tender of the government while deposits of the customers are liabilities of the banks. The monetary and fiscal policies of the country have had an impact on the country over the years. Choosing an appropriate fiscal and monetary policy is a challenge for every country (Vroman&Brusentsev, 2005). Canada has adopted diverse frameworks over the years to attain price stability and fiscal sustainability. The stability in the Canadian economy is by adopting principles that gain broad public support and achieve macroeconomic stabilization.
References
Nallari, R., Griffith, B., & World Bank. (2011). Understanding growth and poverty: Theory, policy, and empirics. Washington, D.C: World Bank.
Fitz, G. J., & Economic and Social Research Institute (Dublin). (2003). The mid-term evaluation of the national development plan and community support framework for Ireland, 2000 to 2006: Final report to the Department of Finance. Dublin: Economic and Social Research Institute.
Disha, E. (2020). UPSC EPFO (Enforcement Officers/ Accounts Officers) Exam 2020 Guide. Disha Press
Barro, R. J. (2008). Macroeconomics: A modern approach. Mason: Thomson.
Vroman, W., &Brusentsev, V. (2005). Unemployment compensation throughout the world: A comparative analysis. Kalamazoo, Mich: W.E. Upjohn Institute for Employment Research.
TEXTBOOK, E. Q. U. I. T. Y. E. D. I. T. I. O. N. (2014). PRINCIPLES OF ECONOMICS VOLUME 2 OF 2. Place of publication not identified: LULU COM.
Artis, M. J. (1982). Demand management, supply constraints and inflation. Manchester: Manchester University Press.
Gilliard, J. V., Saunders, P., & National Council on Economic Education. (1995). A framework for teaching basic economic concepts: With scope and sequence guidelines, K-12. New York, N.Y: National Council on Economic Education.
McEachern, W. A. (2012). Econ macro 3. Mason, Ohio: South-Western Cengage Learning.
