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Class : 11
Unit : Economics

Difference between Microeconomics and Macroeconomics.

Ans : The difference between Microeconomics and Macroeconomics are explained below: Basis Microeconomic Macroeconomic i. Meaning It is derived from Greek word Mikros, which means small. It is derived from Greek word Makros, which means large. ii. Nature Microeconomic is the study of individual units of economic. Macroeconomic is the study of economic as a whole. iii. Area of study Microeconomic studies individual economic variable such as a consumer, a household, a firm etc. Macroeconomic studies aggregate economic variable such as national income, national output, general price level, labor of employment etc. iv. Problems The central problem of microeconomics is price determination of individual commodities and factors of production. The central problem of macroeconomic is determination of income and employment and output of country. v. Equilibrium Microeconomic is based on partial equilibrium analysis other things being equal. Macroeconomic is based on general equilibrium. vi. Objective The main objective of microeconomics is utility maximization for consumer and profit maximization for producer. The main objective of macroeconomics are economic development, price estability reducing , unemployment etc. vii. Known as It is also known as price theory. It is also known as income and employment theory.