What's it: Invisible hand refers to the forces that move the market toward equilibrium when there is no intervention. These forces are entirely based on interactions among economic actors in the market. Allowing the supply and demand
Macroeconomic Equilibrium
Macroeconomic Equilibrium: Short Run Vs. Long Run
What's it: A macroeconomic equilibrium occurs when aggregate supply equals aggregate demand. Aggregate supply represents the total output of goods and services. Meanwhile, aggregate demand represents the total goods and services
Full Employment: Meaning, Implication for Unemployment
Full employment means an economy is fully utilizing its productive resources. At this condition, the economy produces at its potential output, and the unemployment rate is at its natural rate. Is full employment means zero
Business Cycle: Meaning, Causes, Phases
Business cycle is repeated ups and downs phases in economic activity, which is divided into several stages: contraction, trough, expansion, and peak. Each stage has a varying duration and introduces uncertainty in economic decisions. Why
Aggregate Demand: Formula, Components and Determinants
Aggregate demand (AD) is the sum of demand for goods and services in the economy at a given price level and a certain period. In the open economy, it comprises demand from four macroeconomic sectors: households, businesses, governments, and
Aggregate Supply: Meaning, Determinants
Aggregate supply (AS) is the total production of goods and services in the economy. In macroeconomics, aggregate supply will behave differently in the very short run, short run, and long term, as reflected in the elasticity of its
Aggregate Supply: Meaning, Determinants
Aggregate supply (AS) is the total production of goods and services in the economy. In macroeconomics, aggregate supply will behave differently in the very short run, short run, and long term, as reflected in the elasticity of its