defferent between microeconomic and macroeconomics for 5 marks
Answers
Answer:
The main difference between microeconomics and macroeconomics is scale. Microeconomics studies the behavior of individual households and firms in making decisions on the allocation of limited resources. ... Macroeconomics is the study of economies on the national, regional or global scale.
Explanation:
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Explanation:
Parameters of Differentiation Microeconomics Macroeconomics
Meaning
Microeconomics studies the particular market segment of the economy Macroeconomics studies the whole economy, that covers several market segments
Deals with Microeconomics deals with various issues like demand, supply, factor pricing, product pricing, economic welfare, production, consumption, etc. Macroeconomics deals with various issues like national income, distribution, employment, general price level, money, etc.
Business Application Applied to internal issues Environment and external issues
Scope Covers several issues like demand, supply, factor pricing, product pricing, economic welfare, production, consumption, etc. Covers several issues like distribution, national income, employment, money, general price level, etc.
Significance Useful in regulating the prices of a product alongside the prices of factors of production (labour, land, entrepreneur, capital, etc) within the economy Perpetuates firmness in the broad price level and solves the major issues of the economy like deflation, inflation, rising prices (reflation), unemployment and poverty as a whole
Limitations It is based on impractical presuppositions, i.e., in microeconomics, it is presumed that there is full employment in the community, which is not at all feasible It has been scrutinized that Misconception of Composition’ incorporates, which sometimes fails to prove accurate because it is feasible that what is true for aggregate (comprehensive) may not be true for individuals too