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Economics Health Equation

Cowboy0108
Posts: 420
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5/19/2015 12:43:12 PM
Posted: 1 year ago
This is an equation that I came up with that would define the economic health of a country:

((GDP/ND)(E))/((I)(G)(abs(AD/AS - AS/AD))

Where GDP=Gross Domestic Product
ND=National Debt
E=Economic Growth Rate
I=Inflation Rate
G=Gini Coefficient
AD and AS =Aggregate Demand and Aggregate Supply

Is this viable, what should change, is an economic health equation even possible?
lannan13
Posts: 23,099
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5/19/2015 4:01:20 PM
Posted: 1 year ago
At 5/19/2015 12:43:12 PM, Cowboy0108 wrote:
This is an equation that I came up with that would define the economic health of a country:

((GDP/ND)(E))/((I)(G)(abs(AD/AS - AS/AD))

Where GDP=Gross Domestic Product
ND=National Debt
E=Economic Growth Rate
I=Inflation Rate
G=Gini Coefficient
AD and AS =Aggregate Demand and Aggregate Supply

Is this viable, what should change, is an economic health equation even possible?

Not really, for some countries it is viable that a small amount of debt is good for the nation, but too much is harmful. That in itself would destroy your equation.
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If the sky's the limit then why do we have footprints on the Moon? I'm shooting my aspirations for the stars.

"If you are going through hell, keep going." "Sir Winston Churchill

"No one can make you feel inferior without your consent." "Eleanor Roosevelt

Topics I want to debate. (http://tinyurl.com...)
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Cowboy0108
Posts: 420
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5/19/2015 4:03:41 PM
Posted: 1 year ago
At 5/19/2015 4:01:20 PM, lannan13 wrote:
At 5/19/2015 12:43:12 PM, Cowboy0108 wrote:
This is an equation that I came up with that would define the economic health of a country:

((GDP/ND)(E))/((I)(G)(abs(AD/AS - AS/AD))

Where GDP=Gross Domestic Product
ND=National Debt
E=Economic Growth Rate
I=Inflation Rate
G=Gini Coefficient
AD and AS =Aggregate Demand and Aggregate Supply

Is this viable, what should change, is an economic health equation even possible?

Not really, for some countries it is viable that a small amount of debt is good for the nation, but too much is harmful. That in itself would destroy your equation.

How so? Countries benefit according to this equation by how little debt they have. However, no debt or negative debt would not work in this equation.
lannan13
Posts: 23,099
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5/19/2015 4:05:27 PM
Posted: 1 year ago
At 5/19/2015 4:03:41 PM, Cowboy0108 wrote:
At 5/19/2015 4:01:20 PM, lannan13 wrote:
At 5/19/2015 12:43:12 PM, Cowboy0108 wrote:
This is an equation that I came up with that would define the economic health of a country:

((GDP/ND)(E))/((I)(G)(abs(AD/AS - AS/AD))

Where GDP=Gross Domestic Product
ND=National Debt
E=Economic Growth Rate
I=Inflation Rate
G=Gini Coefficient
AD and AS =Aggregate Demand and Aggregate Supply

Is this viable, what should change, is an economic health equation even possible?

Not really, for some countries it is viable that a small amount of debt is good for the nation, but too much is harmful. That in itself would destroy your equation.

How so? Countries benefit according to this equation by how little debt they have. However, no debt or negative debt would not work in this equation.

What exactly do you mean by how so?
-~-~-~-~-~-~-~-Lannan13'S SIGNATURE-~-~-~-~-~-~-~-

If the sky's the limit then why do we have footprints on the Moon? I'm shooting my aspirations for the stars.

"If you are going through hell, keep going." "Sir Winston Churchill

"No one can make you feel inferior without your consent." "Eleanor Roosevelt

Topics I want to debate. (http://tinyurl.com...)
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Cowboy0108
Posts: 420
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5/21/2015 10:22:07 AM
Posted: 1 year ago
At 5/19/2015 4:05:27 PM, lannan13 wrote:
At 5/19/2015 4:03:41 PM, Cowboy0108 wrote:
At 5/19/2015 4:01:20 PM, lannan13 wrote:
At 5/19/2015 12:43:12 PM, Cowboy0108 wrote:
This is an equation that I came up with that would define the economic health of a country:

((GDP/ND)(E))/((I)(G)(abs(AD/AS - AS/AD))

Where GDP=Gross Domestic Product
ND=National Debt
E=Economic Growth Rate
I=Inflation Rate
G=Gini Coefficient
AD and AS =Aggregate Demand and Aggregate Supply

Is this viable, what should change, is an economic health equation even possible?

Not really, for some countries it is viable that a small amount of debt is good for the nation, but too much is harmful. That in itself would destroy your equation.

How so? Countries benefit according to this equation by how little debt they have. However, no debt or negative debt would not work in this equation.

What exactly do you mean by how so?
I mean how is the equation not viable because of the debt concept.
lannan13
Posts: 23,099
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5/21/2015 12:28:44 PM
Posted: 1 year ago
At 5/21/2015 10:22:07 AM, Cowboy0108 wrote:
At 5/19/2015 4:05:27 PM, lannan13 wrote:
At 5/19/2015 4:03:41 PM, Cowboy0108 wrote:
At 5/19/2015 4:01:20 PM, lannan13 wrote:
At 5/19/2015 12:43:12 PM, Cowboy0108 wrote:
This is an equation that I came up with that would define the economic health of a country:

((GDP/ND)(E))/((I)(G)(abs(AD/AS - AS/AD))

Where GDP=Gross Domestic Product
ND=National Debt
E=Economic Growth Rate
I=Inflation Rate
G=Gini Coefficient
AD and AS =Aggregate Demand and Aggregate Supply

Is this viable, what should change, is an economic health equation even possible?

Not really, for some countries it is viable that a small amount of debt is good for the nation, but too much is harmful. That in itself would destroy your equation.

How so? Countries benefit according to this equation by how little debt they have. However, no debt or negative debt would not work in this equation.

What exactly do you mean by how so?
I mean how is the equation not viable because of the debt concept.

Because the GDP is devided by the debt which means that all debt is bad.
-~-~-~-~-~-~-~-Lannan13'S SIGNATURE-~-~-~-~-~-~-~-

If the sky's the limit then why do we have footprints on the Moon? I'm shooting my aspirations for the stars.

"If you are going through hell, keep going." "Sir Winston Churchill

"No one can make you feel inferior without your consent." "Eleanor Roosevelt

Topics I want to debate. (http://tinyurl.com...)
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Cowboy0108
Posts: 420
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5/21/2015 12:48:28 PM
Posted: 1 year ago
What exactly do you mean by how so?
I mean how is the equation not viable because of the debt concept.

Because the GDP is devided by the debt which means that all debt is bad.

Yes, but that is an exception, not the rule. In general, large amounts of debt are not good for an economy, and this equation punishes that. If the national debt equals just 10% of GDP, then you get a value of 10 for that portion, which is a large number within this equation.
lannan13
Posts: 23,099
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5/21/2015 4:18:38 PM
Posted: 1 year ago
At 5/21/2015 12:48:28 PM, Cowboy0108 wrote:
What exactly do you mean by how so?
I mean how is the equation not viable because of the debt concept.

Because the GDP is devided by the debt which means that all debt is bad.

Yes, but that is an exception, not the rule. In general, large amounts of debt are not good for an economy, and this equation punishes that. If the national debt equals just 10% of GDP, then you get a value of 10 for that portion, which is a large number within this equation.

But still, it's for that reason alone that this equation is incorrect. Plus the point DK raised.
-~-~-~-~-~-~-~-Lannan13'S SIGNATURE-~-~-~-~-~-~-~-

If the sky's the limit then why do we have footprints on the Moon? I'm shooting my aspirations for the stars.

"If you are going through hell, keep going." "Sir Winston Churchill

"No one can make you feel inferior without your consent." "Eleanor Roosevelt

Topics I want to debate. (http://tinyurl.com...)
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Cowboy0108
Posts: 420
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5/21/2015 6:25:03 PM
Posted: 1 year ago
At 5/21/2015 2:56:32 PM, darkkermit wrote:
If I'm reading your equation right, sh1t starts getting crazy when AD = AS.

Yes, the denominator cannot equal zero. However, it is highly unlikely that AD=AS perfectly. As long as they are close, it is fine.