From Problem 5, write down the quarters in which the six traditional recessions started. Find the monthly series in the Federal Reserve Bank of St. Louis (FRED) database for the seasonally adjusted unemployment rate. Retrieve the monthly data series on the unemployment rate for the period 1969 to the end of the data. Make sure all data series are seasonally adjusted.

a. Look at each recession since 1969. What was the unemployment rate in the first month of the first quarter of negative growth? What was the unemployment rate in the last month of the last quarter of negative growth? By how much did the unemployment rate increase?

b. Which recession had the largest increase in the rate of unemployment? Begin with the month before the quarter in which output first falls and measure to the highest level of the unemployment rate before the next recession.

Problem 5

U.S. postwar recessions

This question looks at the recessions over the past 40 years. To work this problem, first obtain quarterly data on U.S. output growth for the period 1960 to the most recent date from the Web site www.bea.gov. Table 1.1.1 presents the percent change in real gross domestic product. This data can be downloaded to a spreadsheet. Plot the quarterly GDP growth rates from 1960:1 to the latest observations. Did any quarters have negative growth? Using the definition of a recession as two or more consecutive quarters of negative growth, answer the following questions

a. How many recessions has the U.S. economy undergone since 1960, quarter 2?

b. How many quarters has each recession lasted?

c. In terms of length and magnitude, which two recessions have been the most severe?