For this Discovering Data exercise, use FRED (fred.stlouisfed.org) to create a graph comparing the sources of government tax revenue for the United States over time. Under the tools tab select “Published Data Lists.” Find the list “Government Revenue by Source” and create a line graph that combines all three series.

a. Using data from your graph, which source of government revenue is the largest? How have revenue sources changed over time?

To measure the growth of government revenue since the start of the 2007 recession, follow these steps to format your graph as an index graph where 2007-12-01 = 100.

i. Select “Edit Graph” and under “Edit Line 1” change “Units” to “Index (Scale value to 100 for chosen data).”

ii. In the box “U.S. recession” select “2007-12-01 Start” and then “Copy to All.”

iii. In the graph frame change the time span from 2007-10-01 to today.

b. Using the values in the graph, calculate the growth rate of each source of government revenue since 2007-12-01. Which has grown the fastest?

Finally, edit your graph to compare how each source of revenue has changed as a percentage of total revenue. Complete the steps for each line:

i. Under “Edit Line” change “Units” to “Billions of Dollars.”

ii. Under “Customize data” add the series “Federal Government Current Receipts” (code FGRECPT).

iii. In the formula box enter “100*(a/b)” to express each series as a percentage of total tax receipts.

iv. In the graph frame change the time frame to “Max.”

c. Use your graph to explain how the three sources of government revenue have changed over time and what happened to each source of revenue during the Great Recession.