Micro economics and Macro economics:
Economics is broadly divided into two parts 1) Microeconomics 2) Macroeconomics, following is a brief description of the micro concept of economics.
MICROECONOMICS:
Meaning of Microeconomics
Micro means small.microeconomics deals with economic issues related to small economics units 1) an individual consumer. 2) an individual producer 3) an individual firm 4) an individual industry and 5)an individual market.
Definition
“ Microeconomics is the study of particular firms, particular households, individual wages, incomes, individual industries, and particular commodities” - professor Boulding.
Microeconomics
This is the study of the way individual units make decisions regarding the efficient allocation of their scared resources.Also, these individual units are consumers or firms.
In Microeconomics, the focus is on a small number of units rather than all units combined, further, it does not give us a picture of the happenings in the wider economic environment. The study includes :
* Product pricing
* Consumer behavior
* Factor pricing
* The. Economic conditions of.a section of people
* The behavior of firms and
* Location of the industry.
Microeconomics
Meaning. The branch of economics that studies the behavior of an individual consumer, firm, family is known as Microeconomics.
Deals with. Individual economic variables.
Business. Applied to
Application. Operation or internal issues.
Tools. Demand and supply.
Assumption. It assumes that all macro- economic variables are constant.
Concerned Theory of product pricing, Theory of factor pricing, factor of economic welfare.
With
Scope. Cover various issues like demand , supply , product pricing, factor pricing, production, consumption, economic welfare, etc
Meaning and Definition of macroeconomics
Macroeconomics is a branch of economics that focuses on general or large - scale economic factor- it looks at the ‘ big picture ’ . The word macro means overall or scale.
Macroeconomics gathers and analyzes economy - wide data and phenomena such as inflation , unemployment, GDP ( gross domestic product ) growth, and national income.
According to professor Shapiro “ macroeconomics deals with the functioning of the economy as a whole” .
Macroeconomics
Meaning. The branch of economics that studies the behavior of the whole economy, ( both national and international) is known as Macroeconomics.
Deals with. Aggregate economic variable.
Business
Application. Environment and external issues.
Tools. Aggregate demand and aggregate supply.
Assumption. It assumes that all Microeconomics various are constant.
Scope. Covers various issues like, national income, general price level, distribution, employment, money etc.
