06 Jul Measurement ProjectInstructions:This assignment is an extra cr

Measurement ProjectInstructions:This assignment is an extra credit mini project. It asks   you to download data and reproduce the graphs shown in class.It is designed to give you an idea of what the measurements we talked about in class look like in reality. You can use whatever software you are comfortable with to finish the assignment. (e.g. Excel, STATA, R, Matlab, and etc)Submission:You can discuss with your classmates, but you must finish the project individually and submit the following to me ): (1) a PDF/word file of plots and answers; (2) a zip file including all of your raw data, excel file, and codes (if you have any).  Download the following data from FRED from 1941 – 2017.1.Nominal GDP, seasonally adjusted, at quarterly frequency;2.Real GDP, seasonally adjusted, at quarterly frequency;3.Real domestic investment, seasonally adjusted, at quarterly frequency;4.Real consumption expenditure, seasonally adjusted, at quarterly frequency;5.Real government expenditure, seasonally adjusted, at quarterly frequency;6.Real net export, seasonally adjusted, at quarterly frequency;7.CPI for all urban consumers, seasonally adjusted, at quarterly frequency;Use the downloaded data to plot the following graphs and answer the following questions.1.Plot the graph of real logGDP and nominal logGDP. What’s difference between these two measurements of GDP? Which one do you think is a better measurement of production capacity of a country? Why?2.Reproduce the graph on Slide 16 ofMeasurement. (Remember to take natural log for each variable.)3.Reproduce the graph on Slide 17 ofMeasurement. (Remember to take natural log for each variable.)4.Plot the graph of implicit GDP deflator constructed fromnominal GDP and real GDP.  5.Use the implicit GDP deflator in 4 and the CPI downloaded from FRED to construct inflation rate respectively. Plot these two inflations in one graph. Roughly, which one is higher? Which one fluctuates more?