Macroeconomics facts for kids
Macroeconomics studies large-scale economic decisions. For example, a whole country's economy (or, its economic output) is summarised by the GDP (gross domestic product). Many governments use macroeconomic ideas to decide how much tax to collect and what interest rates should be.
It also considers the amount of unemployment, the rate that prices go up (inflation), and the exchange rates of its currency. The exchange rate affects the amount of imports and exports. Exchange rates and taxation are "levers of the economy".
Less dramatic, but also very important, are decisions about government spending inside the country. Such police decisions are politically controversial due to differing political ideas on government spending. Another factor in macroeconomics is the make-up of the population. A growing population is economically different from a stable population (one which is not growing).
Related pages
Images for kids
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A chart using US data showing the relationship between economic growth and unemployment expressed by Okun's law. The relationship demonstrates cyclical unemployment. Economic growth leads to a lower unemployment rate.
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An example of intervention strategy under different conditions
See also
In Spanish: Macroeconomía para niños
