◢ Keyword: E. ⬛ Taswell. ☢️ Fundamental. ⚫ UK. Macroeconomics. Circulation in macroeconomics. Macroeconomics (from the Greek prefix makro- meaning "large" and economics) is a branch of economics dealing with the performance, structure, behavior, and decision-making of an economy as a whole, rather than individual markets.
This includes national, regional, and global economies.[1][2] With microeconomics, macroeconomics is one of the two most general fields in economics. While macroeconomics is a broad field of study, there are two areas of research that are emblematic of the discipline: the attempt to understand the causes and consequences of short-run fluctuations in national income (the business cycle), and the attempt to understand the determinants of long-run economic growth (increases in national income). Macroeconomic models and their forecasts are used by governments to assist in the development and evaluation of economic policy.
Basic macroeconomic concepts[edit] Output and income[edit] Unemployment[edit] Main article: Unemployment IS–LM[edit] 1. Macroeconomics. Macroeconomics studies the performance of an economy as a whole. While microeconomics focuses on the decisions, spending and performance of individuals or single businesses, macroeconomics focuses on aggregate expenditure and consumption of a nation or region, the amount saved and spent by all households, the productiveness of a country’s labor force, how actions of a government and central bank stimulate the overall economy, and more. Common macroeconomic measurements include Gross Domestic Product (GDP) which is the total amount of goods produced by an economy; unemployment, which is the percentage of people in the economy that are not working; and inflation, the rate at which prices are rising. Macroeconomists develop models to explain the relationship of these factors to the overall economy, and at what magnitude each factor can affect the economic environment as a whole.
Interest rate. An interest rate is the rate at which interest is paid by borrowers (debtors) for the use of money that they borrow from lenders (creditors). Specifically, the interest rate is a percentage of principal paid a certain number of times per period for all periods during the total term of the loan or credit. Interest rates are normally expressed as a percentage of the principal for a period of one year, sometimes they are expressed for different periods like for a month or a day.
Different interest rates exist parallelly for the same or comparable time periods, depending on the default probability of the borrower, the residual term, the payback currency, and many more determinants of a loan or credit. For example, a company borrows capital from a bank to buy new assets for its business, and in return the lender receives rights on the new assets as collateral and interest at a predetermined interest rate for deferring the use of funds and instead lending it to the borrower.
Is widely used. Gross domestic product. Gross domestic product (GDP) is defined by the Organisation for Economic Co-operation and Development (OECD) as "an aggregate measure of production equal to the sum of the gross values added of all resident, institutional units engaged in production (plus any taxes, and minus any subsidies, on products not included in the value of their outputs). "[2] GDP estimates are commonly used to measure the economic performance of a whole country or region, but can also measure the relative contribution of an industry sector.
This is possible because GDP is a measure of 'value added' rather than sales; it adds each firm's value added (the value of its output minus the value of goods that are used up in producing it). The more familiar use of GDP estimates is to calculate the growth of the economy from year to year (and recently from quarter to quarter). History[edit] The history of the concept of GDP should be distinguished from the history of changes in ways of estimating it.
Determining GDP[edit] Producer price index. A Producer Price Index (PPI) measures the average changes in prices received by domestic producers for their output. It is one of several price indices. Its importance is being undermined by the steady decline in manufactured goods as a share of spending.[1] Related measures[edit] A number of countries that now report a Producer Price Index previously reported a Wholesale Price Index. PPIs around the world[edit] United States[edit] In the US, the PPI was known as the Wholesale Price Index, or WPI, up to 1978. India[edit] See also[edit] References[edit] Jump up ^ The Economist, Volume 387, May 31 - June 6, 2009, page 109Jump up ^ BLS Handbook of Methods, Chapter 14 Producer Prices, Background (found online at: up ^ Senate Committee on Finance, Wholesale Prices, Wages, and Transportation, Senate Report No. 1394, “The Aldrich Report,” Part I, 52nd Congress, 2d sess., March 3, 1893; and U.S.
External links[edit] Consumer price index. A graph of the US CPI from 1913 to 2013 (in blue), and its percentage annual change (in red) A consumer price index (CPI) measures changes in the price level of a market basket of consumer goods and services purchased by households. The CPI is a statistical estimate constructed using the prices of a sample of representative items whose prices are collected periodically. Sub-indexes and sub-sub-indexes are computed for different categories and sub-categories of goods and services, being combined to produce the overall index with weights reflecting their shares in the total of the consumer expenditures covered by the index.
It is one of several price indices calculated by most national statistical agencies. The annual percentage change in a CPI is used as a measure of inflation. Introduction[edit] Ideally, the weights would relate to the composition of expenditure during the time between the price-reference month and the current month. The coverage of the index may be limited. Or . Where the. Construction price and cost indices. The quarterly Department for Business, Innovation and Skills (BIS) construction price and cost indices (PCIs) are produced for use in estimating, cost checking and fee negotiation on public sector construction works.
The PCIs are published as an online service by Aecom under contract to BIS. The publication provides comprehensive public sector construction price and cost information in Great Britain, including the following indices: tender price index of public sector building non-housing, social housing, and road construction resource cost indices for buildings, roads, infrastructure and building maintenance output price indices for construction sectors output price indices for direct labour location and function studies The UK Statistics Authority has designated these statistics as National Statistics, in accordance with the Statistics and Registration Service Act 2007 and signifying compliance with the Code of Practice for Official Statistics. Monster Employment Index. The Monster Employment Index was a monthly analysis of online job demand conducted by Monster Worldwide, running from October 2003 to December 2012.[1] Based on a monthly review of millions of opportunities culled from a large selection of corporate career sites and job boards, including Monster, the Index presented a snapshot of employer online recruitment activity in the United States, Canada and Europe.
Because recruitment typically precedes actual hiring by a month or two, the Monster Employment Index was considered a labor market leading indicator and a rough gauge of the overall economy. The U.S. Monster Employment Index was released the day prior to the Bureau of Labor Statistics' Employment Situation while the Monster Employment Index Europe was published on the second Tuesday of each month, with individual reports for the UK, Germany, France, Netherlands, Italy, Sweden and Belgium. The Monster Employment Index Canada was released quarterly. How is Unemployment Defined? - Video. Unemployment occurs when a person who is actively searching for employment is unable to find work. The most frequently cited measure of unemployment is the unemployment rate.
This is the number of unemployed persons divided by the number of people in the labor force. Unemployment is often used as a measure of the health of the economy. There are three types of unemployment frequently referenced in economics, 1. . ·2. . ·3. The natural rate of unemployment is that amount of unemployment that occurs naturally due to imperfect information and job shopping.