economics

Macroeconomics

The branch of economics that studies the behavior and performance of an economy as a whole, including issues like inflation, national income, and unemployment.

Gross Domestic Product (GDP)

Measures the total economic output of a country, calculated using three methods: production, income, and expenditure.

Unemployment Rate

The percentage of the labor force that is unemployed and actively seeking employment, including types such as cyclic, frictional, and structural unemployment.

Inflation

The rate at which the general level of prices for goods and services rises, eroding purchasing power, measured by indices such as the Consumer Price Index (CPI).

Fiscal Policy

Government adjustments to its spending levels and tax rates to influence the economy, which can be expansionary or contractionary.

Monetary Policy

The process by which a central bank manages money supply and interest rates to achieve economic objectives using tools like open market operations and reserve requirements.

Business Cycle

The fluctuation in economic activity that an economy experiences over time, typically measured by GDP, with stages including expansion, peak, contraction, and trough.

Aggregate Demand (AD)

Total demand for final goods and services in the economy at a given time and price level, with components including consumption, investment, government spending, and net exports.

Aggregate Supply (AS)

Total supply of goods and services available in the economy at a given overall price level, influenced by factors like labor force, capital stock, and technology.

Keynesian Economics

A theory that advocates for active government intervention to manage economic cycles.

Classical Economics

An economic theory that emphasizes how free markets regulate themselves and how prices adjust to clear markets.

International Trade

The exchange of goods and services between countries influenced by tariffs, quotas, and trade agreements, where comparative advantage dictates specialization.