Describe the macroeconomic variables, Macroeconomics

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Q. Describe the macroeconomic variables?

In this section we have summarizes all the macroeconomic variables. The first column denotes the symbol we use for variable whereas column 2 shows the name of variable.

Variable

Variable name          

Real GDP

Price level

P.Y

Nominal GDP

U

Unemployment

L

Hours worked

K

Amount of capital

W

Nominal wage

W/P

Real wage

M

Money supply (nominal)

R

Nominal interest rate

r

Real interest rate

C

Private consumption (real)

I

Investments (real)

G

Government expenditure (real)

NT

Net tax (real)

X

Exports (real)

Im

Imports (real)

NX

Net exports (real)

SH

Household savings (real)

SG

Government savings (real)

SR

Rest of the world savings (real)

p

Inflation

pe

expected inflation

pw

Wage inflation

pM

Growth in money supply

E

Exchange rate

pE

Depreciation in exchange rate

Two of the variables are stock variables: K and M. Prices can't be characterized as a stock or flow variable. P, W, R, r and E apply at a given point in time whereas p, pe, pw and pE apply over a period of time. p, pw and pE are changes in P, W and E during previous time period while pe is the expected change in P during next time period. All the other variables are flow variables measured in some unit per unit of time (for instance, L is the number of hours worked per year or per any other unit of time).


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