discussionu - Macroeconomics is the study of the economy as...

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Macroeconomics is the study of the economy as a whole, and the variables that control the macro-economy. Also the study of government policy meant to control and stabilize the economy over time, that is, to reduce fluctuations in the economy (Saylor, n.d). Macroeconomics is the study of monetary policy, fiscal policy, and supply-side economics. The two variable of the macroeconomic that can affect the business environment are inflation rate and unemployment rate. Inflation is a sustained increase in the general level of prices for goods and services. It is measured as an annual percentage increase. It is important for businesses to be mindful of the affects inflation can have on the economy. Even a small increase could hurt capital expenditure and increase the cost of production for goods businesses. In using macroeconomics it is important for a person to understand how unemployment rates can affect the health of the economy. Unemployment is a key macroeconomic indicator to determine the health of an economy. It is vital to
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Unformatted text preview: understand fewer people with jobs, then they have less disposable income to spend on investments (INY², 2009). ²herefore, unemployment causes a ripple e³ect through the economy because when a person losing their job that is one person that cannot pay state and federal taxes. Unemployment people will not use their buying power because their income has decrease. Many of these people will not be paying sales taxes on products. It is important to understand that inFaTon and unemployment are components that macroeconomic uses as indicators to determine the health of the economy. ²he growth of the economy is based on the low inFaTon rates and a stable unemployment rate for the economy to conTnue to meet the country’s needs. Saylor.org (n.d.). ECON202: Intermediate Macroeconomics. Retrieved September 8, 2015. The Interna±onal New York Times (April, 2009). Opinion Pages: Unemployment Rising. Retrieved September 8, 2015 from h²p:// ±mes.com/2009/04/05/opinion/05sun1.html?_r=0...
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