Difference between Macroeconomics and Microeconomics

Transcript

There are 2 main branches of Economics Microeconomics Macroeconomics Difference between Microeconomics and Macroeconomics Produces and Sells Goods Money Firms Households Govt External Sector Microeconomics Macroeconomics Studies Behavior of Individual Producer and Individual Consumer It covers issues like Individual Demand and Individual Supply Regulate Price of Commodity Studies Effect of Individual Market Decision of a Customer or business It Studies Behavior of Overall aggregates of economy Example-All sectors of an economy like Firms, Households, Govt and External Sector It covers issues like Market Demand and Market Supply Regulate Inflation in Economy Studies effect of decision taken by Government and RBI This we covered in Class 11 This we will cover in Class 12 What is Macroeconomics? It is a branch of economics which studies interrelationship between different sectors of economy like firms, Households, Govt and External Sector NCERT Questions Q1 What is the difference between microeconomics and macroeconomics? Ans Basis Microeconomics Macroeconomics Meaning It is a branch of Economics which studies behaviour of individual economic agents It is branch of economics which studies aggegates of economy as a whole like Domestic Income,National income etc Tools Its main tools are Demand and Supply of a Product Its main tools are Aggregate Demand and Aggregagte Supply of a Product Objective It is useful to regulate price of a product It is useful to regulate price of a economy like inflation,deflation Degree of Aggregation It studies individual business decisions like how much Demand increase if price is reduced It studies decisions made by country and government like effect on production by increase in interest rate Other Name It is also known as 'Price Theory' It is also known as 'Income and Employment Theory' Example Individual Income, Individual Output National Income, National Output Other Books No more questions