Economics Calculators

Economic ideas are easier to follow once the numbers move. Changing an input and watching GDP growth, elasticity or a market surplus respond makes the relationship concrete in a way a definition alone does not. This section gathers those working calculations in one place, from classroom concepts to the indicators reported in the news.

Raise a price from $10 to $12 and quantity falls from 100 to 80: how elastic is demand?

Total factor productivity (TFP) is the part of output that labor and capital alone cannot explain: technology, innovation, management, and efficiency.

When new spending enters the economy, each dollar becomes someone’s income, and part of it gets spent again.

Marginal productivity is the extra output you get from one more unit of any input, a worker, a machine hour, a kilo of material, while everything else stays the same.

When income rises or falls, spending does not move dollar for dollar: it moves by the marginal propensity to consume.

The law of demand says that as price rises, quantity demanded falls, and as price falls, quantity demanded rises, other things equal.

“Marginal income” means two different things depending on who is speaking.

Equilibrium income is the level of national income where aggregate demand exactly equals output: firms produce what buyers plan to spend, inventories stay where firms want them, and income has no built-in reason to rise or fall.

Most people do not have one income.

The GDP price index, also called the GDP deflator, separates real economic growth from price growth.