Discuss if it is a useful macroeconomic tool writing homework help

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Calculate the misery index. Discuss if it is a useful macroeconomic tool.

Unemployment is a problem and so is inflation. Being burdened with both problems at the same time is real misery. The late Arthur Okun proposed measuring the extend of misery by adding together the inflation and unemployment rates. He called the sum of the two rates the “discomfort index”. Political pundits quickly renamed it the “misery index”.

Part #1: Calculate the misery index for the years 1994-2015.

Find the inflation rate and the unemployment rate at www.bls.gov.

Use annual data.

Part #2: Do you think that the misery index is a useful measure of macro-economic performance?

Explain why or why not.

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