FT blog: US economy beats forecasts to grow at 3.4% rate in third quarter
This blog is based on the article published by the Financial Times on October 29 2026
https://www.ft.com/content/f2de9f3c-3290-4e87-bbc2-55430025f2ab?syn-25a6b1a6=1
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This Financial Times article reports on 3.4% economic growth in the US in the third quarter of 2026. This is a strong performance for the US economy, and the article highlights investment in artificial intelligence and strong consumer spending as key drivers of this growth. The article also considers the US's growth performance in light of inflationary pressures in the economy.
Questions
a. Describe what has happened to US economic growth in the third quarter of 2026. [2]
b. Using an aggregate demand and supply diagram, explain the impact that a 3.8% increase in US consumer spending would have on US economic growth. [4]
c. Outline how business spending on artificial intelligence might have contributed to a 9.4% increase in US investment. [2]
d. Using a production possibility diagram, explain how an increase in business spending on AI might affect US potential output. [4]
e. Using an aggregate demand and supply diagram, explain the impact that a rise in energy costs because of the war in Iran might have on US economic growth. [4]
Total [16]