An ideal economy is one in which there is rapid growth of output per worker, low unemployment, and low inflation. There can be times of slow growth, however high unemployment and high inflation.
Several macroeconomic concerns include:
• A recession, which is a period where real GDP declines for at least two consecutive quarters
• A depression, which is a prolonged and deep recession
• Unemployment, which is the ratio of the number of unemployed people to the number of people in the labor force
• One final macroeconomic concern is inflation. Inflation is an increase in the overall price level. It happens when many prices increase simultaneously. A deflation is a decrease in the overall price level. Whether a person gains or loses during a period of inflation depends on whether his or her income rises faster or slower than the prices of the things he or she buys.
