For instance, during the first half of 1984, did a sudden growth spurt in the economy upset most business forecasts?

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<a href="http://qanda.encyclopedia.com/question/instance-during-first-half-1984-did-sudden-growth-spurt-economy-upset-most-business-forecasts-615587.html" >For instance, during the first half of 1984, did a sudden growth spurt in the economy upset most business forecasts?</a>

At a minimum, businesses now need annual forecasts. One reason business planners prefer the annual averages is that sudden changes in the economic climate can play havoc with the quarter-to-quarter measurements. For instance, during the first half of 1984, a sudden growth spurt in the economy upset most business forecasts. Spurred to expansiveness by a surging cash flow, businesses added to their stock of plant and equipment at the fastest rate in five years. Government spending also went up faster than expected, as did business inventories. That set the stage for the sharp second-half slowdown that included an increased demand for credit and, consequently, higher interest rates. At the time, few had foreseen the short-term trend.