Aggregate demand is the total quantity of goods and services demanded across all levels of an economy at a particular time and price level. It reflects the aggregate expenditure for 'everything that will be bought' in an economy.
Aggregate supply, also known as total output, represents the total amount of goods and services that firms in a national economy are willing to sell during a specific time period at different price levels.
An overarching term that encompasses various elements that affect the general climate of the economy and political situation, thereby influencing the profitability and prosperity of businesses.
The business cycle refers to the fluctuations in economic activity that an economy experiences over a period of time. It consists of expansion, peak, recession, trough, and recovery phases.
Capital deepening refers to the process of increasing the amount of capital per worker in an economy. This typically means that each worker has more tools, equipment, or technology to use in their work, leading to higher productivity and economic growth.
Capital widening in macroeconomics refers to the process of increasing an economy's capital stock to enhance production levels.
The foundational questions that address what a society decides to produce, the methods used for production, and the distribution of the products among its members.
Consumption represents the total spending by individuals or a nation on goods and services during a specific time period. This macroeconomic concept reflects the usage of resources, and although many durables like clothing, appliances, and automobiles are consumed over a longer period, their expense is accounted for within the consumption cycle.
Consumption, Investment, Government expenditures (C&I or C&I&G) are key components of the Gross Domestic Product (GDP), used to measure a country's economic performance.
An expert group of economists appointed by the President of the United States to provide counsel on economic policy.
Disinflation refers to a decrease in the rate of inflation – a slowdown in the rate at which prices are increasing across the economy. Unlike deflation, disinflation is characterized by a reduction in the inflation rate over time, without causing a drop in economic output or employment.
Double-Digit Inflation refers to an inflation rate of 10% per year or higher, significantly impacting purchasing power, savings, and economic stability.
An Economic Cycle refers to the fluctuating levels of economic activity that an economy goes through over a period of time, commonly classified into phases such as expansion, peak, contraction, and trough.
Economic growth refers to the increase, from period to period, of the real value of an economy's production of goods and services, commonly expressed as an increase in Gross Domestic Product (GDP).
The economic growth rate is a key indicator of the increase in a nation's economic activity, represented by the annual percentage change in Gross Domestic Product (GDP). When adjusted for inflation, it is known as the real economic growth rate.
Economic indicators are key statistics that provide insight into the state of the economy. They help policymakers, business leaders, and investors make informed decisions about economic activities.
Gross Domestic Product (GDP) is a comprehensive measure of a nation's overall economic activity, representing the total dollar value of all goods and services produced over a specific time period within a country's borders.
The monetary value of all the goods and services produced by an economy over a specified period. GDP serves as a broad measure of overall economic activity and an indicator of an economy's health.
Gross National Expenditure (GNE) is the total of all expenditures of all kinds within an economy, including both public and private spending. Unlike Gross Domestic Product (GDP), GNE includes expenditures for imports but excludes exports.
Gross National Product (GNP) is a measure of the economic output of a country, accounting for the market value of all goods and services produced by the residents of the country, whether located domestically or abroad.
Gross National Product (GNP) is a financial metric that measures the total economic output of a country's residents, regardless of the geographic location of the output.
Headline inflation measures the total inflation within an economy, encompassing a broad scope that includes volatile items such as food and energy prices, offering an overall picture of price trends in the economy.
Hidden inflation refers to a subtle price increase implemented by offering a smaller quantity or poorer quality of a product or service with no change in its original price.
Economic analysis developed by John Maynard Keynes based on the interaction of the money market and the goods market. It helps predict the effect of monetary and fiscal policies on interest rates and domestic production.
Macroeconomic equilibrium is the point at which total aggregate income, or Gross Domestic Product (GDP), is produced when expected demand and supply are equated. This level of income consists of the planned spending of consumers, businesses, and government.
Macroeconomics is the branch of economics that studies an economy as a whole, focusing on large-scale factors such as national productivity and inflation, and how various sectors and factors interrelate to form a broader economic landscape.
Monetary policy comprises the procedures by which governments or central banks try to affect macroeconomic conditions by influencing the supply of money. This can be achieved through various mechanisms aside from printing more money, including open-market operations, adjusting reserve requirements, and changing interest rates.
The rate of growth in national income that maintains the current level of employment and wages. This rate equals the growth rate of the labor force added to the rate of productivity.
An empirical relationship between unemployment and gross domestic product (GDP), developed by economist Arthur Okun, which states that for every 1% increase in unemployment, there is a corresponding 2% decrease in the national GDP.
The Phillips Curve is an economic proposition stating that there is an inverse relationship between unemployment and inflation rates within an economy. As inflation increases, unemployment tends to decrease and vice versa.
A mathematical formula that describes the relationship between various inputs and the output they produce, often used to analyze the efficiency and productivity of firms or entire industries.
Rational expectations refer to the hypothesis in economics that individuals make decisions based on their best available information, forecasting future economic variables as accurately as possible.
Real GDP, or Real Gross Domestic Product, measures the value of economic output adjusted for price changes (inflation or deflation).
A downturn in economic activity, defined by many economists as at least two consecutive quarters of decline in a country's Gross Domestic Product (GDP).
A soft landing refers to a situation in which an economy slows down but manages to avoid falling into a recession. This term was borrowed from astronautics in the late 1950s and originally described a safe moon landing.
A macroeconomic phenomenon where rising prices push wages higher, which in turn increases production costs and leads to further price increases, creating a feedback loop.
The wealth effect refers to the phenomenon in which an increase in personal wealth—whether actual or perceived—leads to an increase in consumer spending, impacting overall economic activity.
