Measuring the Economy, Economies of Scale

1 Measuring the Economy
(From Mankiw, N. G.: Principles of Economics. New York: Harcourt Brace College Publishers, 1998. Accesible from: <http://www.sparknotes.com/economics/macro/measuring1/summary.html>)

Macroeconomists use a variety of different observational means in their effort to study and explain how the economy as a whole functions and changes over time. One such method relies on personal experience. It is relatively simple to notice that your company is producing more than it has in the past or that a paycheck does not go as far as it used to. Yet while personal observations do provide information about the economy, that information can often be localized rather than universal, and may not accurately reflect the state of the economy as a whole...