In conclusion, demographic shift will result in a population that is slower to increase and is older. The growth rate of potential output, the natural rate of unemployment, and the long-term equilibrium interest rate will all likely fall as a result of this transition. The extent and timing of these effects are unknown since they are dependent on complex dynamics and consumer and corporate behavior. The business cycle and the transmission mechanism of monetary policy may be affected by demographic change. In order to determine appropriate policy, monetary officials will need to constantly examine these structural and cyclical implications. Fiscal policymakers are also confronted with demographic trends. Rising fiscal imbalances are expected to result in larger government debt-to-GDP ratios, thereby driving interest rates higher and squeezing out productive investment.However, there are efforts that can be taken to mitigate some of the economic effects of population transition. Policies aimed at boosting productivity and labor force growth, as well as addressing developing fiscal imbalances, are among them.