Describe the following terms in your words. Term Definition Gross Domestic Product (GDP) Real GDP Nominal GDP Unemployment rate Inflation rate Fiscal Policy Monetary Policy Aggregat.

Gross Domestic Product (GDP) is an economic indicator that measures the total value of all goods and services produced within a country over a given period of time. Real GDP adjusts for inflation and takes into account changes in prices in order to give a truer reflection of economic growth, whereas Nominal GDP does not make this adjustment and instead uses current market prices which may be impacted by things like price increases due to supply shortages. The Unemployment Rate is the percentage of people who are actively seeking employment but have not been able to find jobs; it is usually expressed as a percentage of the labor force. Inflation rate refers to the degree at which prices for goods and services rise over time causing the purchasing power of money to decline. Fiscal Policy refers to government spending or taxation policies designed to influence macroeconomic objectives such as full employment, price stability, balance of payments targets, etc., while Monetary Policy involves actions taken by central banks (e.g., adjusting interest rates) in order to help achieve those same goals. Lastly, aggregate demand refers to total spending on all goods & services within an economy during any given period which can help indicate overall economic health or provide insight into potential policy options when trying to stimulate demand.