What is the difference between macroeconomics and microeconomics?

Answer

According to Investopedia, microeconomics is the study of decisions made by people and businesses regarding the allocation of resources and prices of goods and services, while macroeconomics is the study of the behavior of the economy as a whole. Microeconomics focuses on individual companies, and macroeconomics looks at countries and governments.

Microeconomics involves studying a specific company to determine what can be done by the company to increase productivity and lower costs while increasing the product demand and generating a higher profit. It is based on the idea of a market economy in which consumer demand is the driving force behind the prices and production levels of goods and services. The focus is on the concept of the supply and demand.

Macroeconomics studies a country's typical economy-wide indicators associated with the conditions of national economies. It deals with such statistics as unemployment rates, gross domestic product

(GDP), overall price levels and inflation. Although macroeconomics has a much broader focus than microeconomics does, many macroeconomic factors are essential to making predictions and conclusions at the microeconomic level. For instance, knowing what the unemployment rate is at the national level can help a microeconomist predict future layoffs in a specific industry. The studies of microeconomics and macroeconomics are both important to a country's economy.

Q&A Related to "What is the difference between macroeconomics..."
Macroeconomics. is the branch of economics that deals with aggregate economic decision or behavior of an economy as a whole; for example, the problem of inflation, level of unemployment
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Microeconomics focuses on the economic behavior of individuals, families and businesses. It is the study of the way economic laws - such as supply and demand or competition - affect
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Microeconomics is the study of decisions that
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The difference between these is that macroeconomics is looking at the economy of a country (or even of the world) as a whole. By contrast, microeconomics looks at a smaller part
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Five Differences Between Macroeconomics and Microeconomics
Economics, as a whole, is the study that focuses on production, distribution and consumption of all goods and services within an economy. Microeconomics and macroeconomics are two categories within this subject that each focus on different aspects of the... More »
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Macro and micro are terms used like big and little. Macroeconomics refers to the big picture, with items such as interest rates, national productivity, and other ...
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