Macroeconomic variables, or MVs, are indicators of the overall state of a country's economy. In the United States, they include the Consumer Price Index, average prime rate, Dow Jones Average and inflation rate. The government studies MVs and attempts to keep them at certain levels in order for the economy to function.Know More
Macroeconomics looks at the economy from the widest perspective and studies general trends in order to assess the relative health of a given country's economy. Macroeconomics is important in governing a country, because it is the role of the central government to keep economy stable so that microeconomic activity can take place. Governments can control macroeconomics by issuing money and determining fiscal policies.
The U.S. Federal Reserve has been running Comprehensive Capital Analysis and Review (CCAR) every year since 2009. CCAR is a stress test for the U.S. banking system. The 19 largest American bank holding companies are tested to see if they can lend to the economy in case of an adverse macroeconomic scenario.
Among the macroeconomic variables that the Federal Reserve used to develop the stress scenario for the banks in 2011 were the Consumer Price Index, real GDP, real disposable personal income, 3-month Treasury bill rate, unemployment rate, National Price Index and Dow Jones Index. The next year, MVs such as mortgage rate and Market Volatility Index were added.Learn more about Economics
Although the world has seen multiple centrally planned economies, two of the few remaining examples as of 2015 are Cuba under Fidel and Raul Castro and North Korea under the Kim dynasty, according to the Heritage Foundation and Asian Trade Hub. The most notable historic examples of centrally planned economies include Russia under Joseph Stalin and China under Mao Zedong, according to About News.Full Answer >
An agrarian economy is a type of economy that relies primarily on agricultural industry including livestock farming or crop production. It is a form of economy whose major factor of production is the agricultural land. Prosperity of agrarian economy is also influenced by other factors such adequate rainfall, suitable climate and inputs like fertilizers.Full Answer >
A national economy refers to the economy of an entire country. The national economy includes financial resources and management. It encompasses the value of all goods and services manufactured within a nation.Full Answer >
A planned or command economy is one in which major functions, such as production and distribution of goods, are controlled by the government. In a planned economy, the government owns some or all production facilities and decides what to produce and how goods are priced. This is in contrast to a market economy, where production and distribution are decided by market forces with little or no government intervention.Full Answer >