What is the difference between micro and macro economics?

Asked By: Manshi agrawal

O

Om Prakash OP

Some difference between Micro and Macro Economics: Economics is divided into two major parts, Micro Economics, and Macro Economics.

Micro Economics -

  • It is concerned with the behavior of individual households, business firms, and governments and how they interact with each other. 
  • For Example: How do firms choose how much to produce or what kind of products to produce is a microeconomics question.
  • Micro Economics starts by thinking about how individuals make decisions.

Macro Economics - 

  • It concentrates on the behavior of the economy as a whole. Unemployment, interest rates, how government spending affects the economy, GDP (Gross Domestic Product) or total output of the economy are all macroeconomic topics.
  • Macro and Micro are interrelated - Macro outcomes depend on micro behavior and micro behavior is affected by macro outcomes.
  • Macroeconomics considers aggregate outcomes.

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