Macroeconomics

Six key variables You can get a very good idea of the pulse of economic activity by looking at only six key economic variables: six variables that together give a very large chunk of the significant information about the macroeconomy. These six variables are: Real Gross Domestic Product The unemployment rate The inflation rate The interest rate The level of the stock market The exchange rate. Real GDP The first key quantity is the level …

…the dollar is appreciated, the value of the dollar in terms of other currencies is high: this means that foreign-produced goods are relatively cheap to American buyers, but that American-made goods are relatively expensive for foreigners. When the dollar has depreciated the opposite is the case: American goods are cheap to foreign buyers--thus exports from America are likely to be high or at least about to rise--but Americans' power to purchase foreign-made goods is limited.