The Analysis Of A Model For The Running Condition Of The National Economy In China

In National Account, the GDP (Gross Domestic Product) can be calculated byGDP = C + I + G + W (A-1)And, the mark C denotes Residents Gross Consume; the mark I denotes Gross Investment; the mark G denotes Government Expenditure; the mark W denotes Net Export.The formula (A-1) shows that the two indexes, C and I, are the great important parts to GDP. That means these two indexes affect the size of GDP. On the other hand, GDP makes a strong impact on C and I, too. Interact exists in these three indexes.Traditional single model can not satisfy the request to post interact in the three indexes of GDP, C and I. Then, the group of simultaneous equations will be used in this paper.The following group of simultaneous equations ( A-2 ) will be estimated and simulated with the datum (from the year 1978 to 2001, China). The results will tell us something about the three indexes. The results also show that national economy in China is affected by the outside elements strongly.