Monday, 18 July 2016

Ryan Elantri - How Macroeconomics Affect Everyday Life

As an undergraduate at Penn State, Ryan Elantri has studied macroeconomics. It is an important topic that any student in the areas of finance, business or economics has to understand. If you are coming across the term for the first time, this post will provide a brief primer on what it entails.

When making everyday financial decisions, we may not necessarily think about macroeconomics. In brief, macroeconomics is the study of the economy’s behavior. This is quite different from microeconomics, which tends to focus more on individual behavior in economic decision-making. Regardless, the macro-economy is important because it helps consumers reach better conclusions on issues that impact their daily lives.

Perceptions on the state of the economy may affect how you make certain decisions. For example, in a period of low-interest rates, you will likely consider taking out a mortgage or loan because it’s cheaper to do so. However, high unemployment rates or a slow economy may make a student decide to stay in school and work on getting a degree. In such a scenario, it makes sense to spend three to four years pursuing a degree rather than jumping into a poor job market.

When prices of commodities are high, consumers are likely to think twice about making purchases. Inflation, or the rate at which prices increase, is a big factor that individuals take into account on an almost daily basis.

The economy’s performance affects every individual. By studying the macroeconomic factors that affect it, Ryan Elantri is looking to make better financial decisions.
Ryan Elantri