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Answer» Distinction between Micro and Macro Economics : | Micro Economics | Macro Economics | | 1. It is concerned with an individual economic unit like a consumer, a firm, an industry or income of an individual. | It deals with aggregates of economy such as national income, aggregate expenditure, total employment, general Price level, etc. | | 2. It is based on the assumption of full employment. | It is based on the assumption of under full employment of resources. | | 3. Its central problem is price determination. | Its central problem is production and employment determination. | | 4. What is true at micro level may not be true for macro level. | Group behaviour is applicable on entire economy. | | 5. It is based on the assumption of ‘ other things being equal ‘. This analysis is based on partial equilibrium. | This is based on general equilibrium analysis. | | 6. Its objective is to study the the ories related to optimum distribution of resources. | Its objective is to study the theories related with full employment.
| | 7. Its nature is comparatively easy. | Its nature is comparatively complex. | | 8. It has main instruments of demand and supply. | Its main instruments are aggregate demand, aggregate supply, aggregate saving and investment. |
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