Macroeconomics studies the economy as a whole. Instead of looking at the choices of a single person or business, it examines large-scale issues such as total employment, inflation, economic growth, and national output. These big-picture forces affect every household, every business, and every government decision.

At the heart of macroeconomics is a single uncomfortable fact: resources are limited, but human wants are not. Every economy — whether a household, a city, or a nation — has to decide what to produce with the resources it has, how to produce it, and who gets what’s produced. Those three questions sound simple, but the answers shape everything from the price of groceries to the unemployment rate to whether your generation will be better off than the last.

Economists approach these questions differently than other social scientists. They focus on opportunity cost — what you give up to get something else — and they assume people make choices in their own self-interest, weighing small trade-offs rather than making all-or-nothing decisions. That framework is what separates economics from sociology, psychology, or political science, even though all of them study human choice. By the end of this lesson, you’ll have the vocabulary and the basic mental model that the rest of the course builds on.