Macroeconomics is the branch of economics that studies the overall workings of an economy, such as total income and output; aspects of the economy are viewed in aggregate. For instance, when referring to labor in macroeconomics, the focus is on all workers within an economy, not the choices of an individual worker.
The information presented within Section A: Basics, is preliminary material and will not be tested directly on your upcoming exam. However, we recommend reviewing this material as you will need to know it in order to understand the more advanced topics discussed later.
Gross Domestic Product (GDP) and Gross National Product (GNP)
Gross Domestic Product (GDP) and Gross National Product (GNP) are the two most common measures of a nation's economic output.
Gross domestic product is defined as the value of all goods and services produced within a nation during a particular period of time (typically a year). Market prices are used to determine value and only "final" goods and services (those consumed by the end user) are included.
Gross National Productmeasures the income of all of a nation's citizens, even if that income was earned abroad. Amounts that foreigners earn within the nation's boundaries are not included.
Gross Domestic Product (GDP)
MarketsGross national product (GNP) is one of many metrics economists use to measure a country’s economic output. For any one year, GNP equals the market value of all the goods and services produced ...
MarketsBoth gross domestic product and gross national product try to measure the market value of all goods and services an economy produces.
MarketsLearn what the GNP truly represents, and how its misuse can manipulate the facts.
MarketsMacroeconomics 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 ...
MarketsThese indicators give investors and experts some data to work with, but they're far from perfect measures.
Personal FinanceGross income is an individual’s total income before taxes and other adjustments are considered.
MarketsA nation’s gross domestic product measures the monetary value of all of the goods and services it produces.
MarketsBy Stephen Simpson In general, economics is the study of how agents (people, firms, nations) use scarce resources to satisfy unlimited wants. Macroeconomics is the branch of economics that concerns ...
MarketsFind out everything you need to know about macroeconomics.
MarketsFrom unemployment and inflation to government policy, learn what macroeconomics measures and how it affects everyone.