The subject matter of Economics has been divided into two parts - Microeconomics and Macroeconomics.
Microeconomics
Microeconomics
The term microeconomics is derived from the Greek word mikros, meaning "small". In Microeconomics studying the economic behaviour of an individual, firm or industry in the national economy. It is thus study of a particular unit rather than all the units combined.
We main study the following in microeconomics:
- Product pricing;
- Consumer behaviour;
- Factor pricing;
- Economic conditions of a section of the people;
- Study of firms; and
- Location of industry.
The term macroeconomics is derived from the Greek word makros meaning "large".
It is the study of overall economic phenomena as whole rather than it's individual parts.
Thus, in macroeconomics, we study the economic behaviour of the large aggregates such as the overall conditions of the economy such as Total production, total consumption ,total savings and total investment in it.
It includes:-
- National income and output
- General price level
- Balance of trade and payments
- External value of money
- Saving and investment and
- Employment and economic growth.
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