Fundamentals Of Macroeconomics
Macroeconomics is the study of behavior of the economy. Macroeconomics is an economy-wide phenomenon like the changes in unemployment, inflation, gross products and price levels. Some vocabulary learned from macroeconomics that is important to learn about will be stated next. First gross domestic product this is the value of finished goods and services produced within in a country’s borders in a certain time period. This is usually calculated on an annual basis in macroeconomics. Next is real GDP. Real GDP is inflation adjusted that reflects the value of services and goods produced in a year’s time. This is expressed in based-year prices. Also there is nominal GDP. This is a product that has not been adjusted for inflation. Another definition that is useful in the study of macroeconomics is unemployment rate; this is the percentage of the labor force that is unemployed ...view middle of the document...
How are Purchasing groceries, Layoff of employees and decrease in taxes affected by the government, households and businesses? The flow of how the government works and how households and businesses use each other’s resources from one entity to another for each of these activities is explained next. First when purchasing of groceries this affects businesses because we as the owners of the households buy the products that the government has supplied to the businesses. The government pays us through our jobs; then we use that money to supply goods and products to our households. So when purchasing groceries this affects the government, our households and businesses. Next is the laying off of employees. This affects many people but mainly households. This is because we work to make the money from the government but if we don’t work we wont have the money to buy items from businesses. Businesses are affected because they no longer have people to come buy items from them. This also affects the government because when they have laid off to many of their workers, than they have less people to pay. Everyone is affected when employees are laid off. Last is a decrease in taxes. When there is a decrease in taxes this mainly affects the government because then they have started to receive less money from the households and businesses that they are trying to get the money from. The government gains money by the way they increase and decrease taxes on businesses. Businesses can and cant be affected by the change in taxes because they sale their product and make what money they can from what the government tells them to do. Households can be affected but it depends on how they use and spend their money.
The government makes the rules and the households and businesses are the ones who make and keep the government in business. No matter how one may use these three different subjects they all flow together as one. Macroeconomics is the study of behavior in the economy. This also shows how well they work together and manage to stay successful.