economic factors

Economic factors are elements that influence the economy and can impact individuals, businesses, and governments. They include aspects like employment rates, inflation, interest rates, and consumer spending. For example, when unemployment is low, more people have jobs and can spend money, which usually boosts the economy. Conversely, high inflation means that prices for goods and services rise, affecting purchasing power. Understanding these factors helps explain how economies grow or contract and informs decisions on investments, policy-making, and daily financial choices.