Macroeconomic theory is the branch of economics that studies the behavior and performance of an economy as a whole. It focuses on aggregate indicators such as GDP, unemployment rates, and inflation to understand how different sectors interact and influence overall economic health. This theory helps policymakers make informed decisions by analyzing economic cycles, growth patterns, and the impact of fiscal and monetary policies. By examining these large-scale economic factors, macroeconomic theory aims to provide insights into how to promote sustainable economic growth and stability.