die Wirkung
effect
The effect or consequence that an action, substance, or event has on something or someone.
Die Wirkung des Schmerzmittels ließ schnell nach.
The effect of the painkiller wore off quickly.

effect / impact
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effect
The effect or consequence that an action, substance, or event has on something or someone.
Die Wirkung des Schmerzmittels ließ schnell nach.
The effect of the painkiller wore off quickly.

The noun 'die Wirkung' (effect) is derived directly from the verb 'wirken' (to have an effect / to seem). Both words describe something producing an effect or a particular impression.
Die neuen Regeln wirken sich positiv auf die Sicherheit aus.
The new rules have a positive effect on safety.
You can recognize the meaning from the context: If it is about a measurable effect (e.g., of medicine or a measure), the first meaning is intended. If it is about a subjective impression (e.g., from art or a person), the second meaning is intended.
Die Wirkung des Medikaments setzte sofort ein.
The effect of the medication began immediately.
To name the target of the effect, you use the preposition 'auf' (on) with the accusative. Common collocations are 'eine Wirkung zeigen' (to show an effect), 'ohne Wirkung bleiben' (to have no effect), or the well-known word 'Nebenwirkung' (side effect).
Hat das neue Gesetz eine Wirkung auf die Wirtschaft?
Does the new law have an effect on the economy?
When referring to an impression, 'Wirkung' (impact / impression) is often combined with verbs such as 'entfalten' (to unfold / to develop), 'erzielen' (to achieve), or 'hinterlassen' (to leave behind). These describe how an impression arises or develops.
Erst bei Nacht entfaltet die beleuchtete Brücke ihre volle Wirkung.
Only at night does the illuminated bridge have its full impact.
consequence / episode
'die Folge' and 'die Wirkung' can both describe what happens after an action or event. 'Folge' emphasizes the result or consequence more strongly: something happens, and then something arises from it. 'Wirkung' tends to emphasize the effect on someone or something, for example with medicine, music, colors, or a conversation. Learners may confuse the words because both point to a result. If you are asking, 'What comes from it?', 'Folge' often fits. If you are asking, 'What does it do to someone or something?', 'Wirkung' often fits.

Das Medikament zeigte schon nach einer Stunde eine gute Wirkung.
The medication showed a good effect after just one hour.
Eine Folge des starken Regens war, dass viele Züge später kamen.
One consequence of the heavy rain was that many trains arrived late.