Concepts of micro and macro economics
- 1. Concepts of Micro and Macro Economics MRS.PADMAVATI PATIL
- 2. Microeconomics and Macroeconomics terms were used by Ragnar Frish. Micro and Macro words are derived from Greek words Mikros and Makros. Micro means Small –Which studies Individual unit of the economy. Individual Consumer, Individual firms and small aggregates or groups of individual unit, industries and market. Macro means Large – Which analyze the economy as a whole. Large aggregates – such as national income and output, total employment, total consumption, aggregate investment. Introduction
- 3. Definition of Micro Economics Prof. Maccannel. “Micro economics is a study of the specific economic units and detailed consideration of the behavior of these individual units.” Prof. Boulding. “Micro Economics seeks to explain the working of individual, firms, households, individual prices, wages, particular industries.”
- 4. Subject Matter of Micro Economic
- 5. Importance of Micro Economics For Price determination Helps in Decision –Making Guide for Production Planning Useful for forecasting Art of Economizing Useful for Government Welfare Oriented
- 6. Definition of Macro Economics According P.A. Samuelson - “The Study of the behaviour of the economy as a whole, it examines the overall level on nation's output, employment, prices and foreign trade.” According Kenneth E Boulding – “ Macro economics is the study of the nature, relationship and behaviour of aggregates of economic quantities…macro economics deals not with individual quantities as such, but with aggregate of these quantities…not with individual incomes, but with the national Income not with individual prices, but with the price levels, not with individual output, but with the national output.
- 7. Subject Matter of Macro Economic Theory of National Income Theory of Output and Employment Theory of General Price Level Theory of Economic Growth Theory of International Trade Theory of Money.
- 8. Importance of Macroeconomics: To Understand the Working of the Economy Important Nature of Macroeconomic Issues Importance for Accelerating Economic Growth Understanding Business Cycles Formulating Government’s macroeconomic policies Individual Decision Making Importance in Business Decisions.