Distinguish
between microeconomics and macroeconomics.
Distinguish between microeconomics and macroeconomics.
Points of
Difference
Microeconomics
Macroeconomics
1
Study matters
It studies about individual
economic units like households, firms, consumers, etc.
It studies about an economy as a
whole.
2
Deals with
It deals with how consumers or
producers make their decisions depending on their given budget and
other variables.
It deals with how different
economic sectors such as households, industries, government and
foreign sector make their decisions.
3
Method
It uses the method of partial
equilibrium, i.e. equilibrium in one market.
It uses the method of general
equilibrium, i.e. equilibrium in all markets of an economy as a
whole.
4
Variables
The major microeconomic variables
are price, individual consumer’s demand, wages, rent,
profit, revenues, etc.
The major macroeconomic variables
are aggregate price, aggregate demand, aggregate supply,
inflation, unemployment, etc.
5
Theories
Various
theories studied are:
1) Theory of Consumer’s Behaviour and Demand
2) Theory of Producer’s Behaviour and Supply
3) Theory of Price Determination under Different Market Conditions
Various
theories studied are:
1)
Theory of National Income
2)
Theory of Money
3)
Theory of General Price Level
4)
Theory of Employment
5) Theory of International Trade
|
Points of Difference |
Microeconomics |
Macroeconomics |
|
|
1 |
Study matters |
It studies about individual economic units like households, firms, consumers, etc. |
It studies about an economy as a whole. |
|
2 |
Deals with |
It deals with how consumers or producers make their decisions depending on their given budget and other variables. |
It deals with how different economic sectors such as households, industries, government and foreign sector make their decisions. |
|
3 |
Method |
It uses the method of partial equilibrium, i.e. equilibrium in one market. |
It uses the method of general equilibrium, i.e. equilibrium in all markets of an economy as a whole. |
|
4 |
Variables |
The major microeconomic variables are price, individual consumer’s demand, wages, rent, profit, revenues, etc. |
The major macroeconomic variables are aggregate price, aggregate demand, aggregate supply, inflation, unemployment, etc. |
|
5 |
Theories |
Various theories studied are: 1) Theory of Consumer’s Behaviour and Demand 2) Theory of Producer’s Behaviour and Supply 3) Theory of Price Determination under Different Market Conditions |
Various theories studied are: 1) Theory of National Income 2) Theory of Money 3) Theory of General Price Level 4) Theory of Employment 5) Theory of International Trade |
