Sunday, August 29, 2004

Higher Math at Reuters

Paul at Wizbang quotes Reuters:
WASHINGTON (Reuters) - The U.S. economy slowed more sharply in the second quarter than first thought as oil prices rose and the trade gap swelled, the government said on Friday in a report that confirmed momentum faltered in the spring.

U.S. gross domestic product -- which measures total output within the nation's borders -- expanded at a 2.8 percent annual rate...
Paul says, "I need someone to 'splain this one to me."

My answer: Reuters is simply showing off its advanced knowledge of mathematics. In calculus, the rate of change of a quantity is the first derivative -- that's the growth rate -- which in this case is positive. If, however, the growth rate drops, then the change in the growth rate -- the second derivative -- is negative. Thus, a rigorous organization like Reuters, which is full of "advanced" thinkers, is correct in saying that the U.S. economy slowed, if by "slowed" Reuters is referring to the second derivative. Got it? I'm sure Reuters doesn't.