Microeconomics studies individual economic decision-making units like consumers, firms, and industries, while macroeconomics analyzes the economy as a whole in terms of aggregate supply and demand. The key difference is that microeconomics focuses on micro-level variables and macroeconomics focuses on macro-level or economy-wide variables. Microeconomics tools include supply and demand analysis and factor pricing, while macroeconomics tools include analyzing GDP, inflation, unemployment, and other indicators of overall economic performance. Both are important areas of economics that provide insights, though each operates at different levels of analysis.

1. DIFFERENCE BETWEEN MACRO
AND MICRO ECONOMICS
Maddali Laxmi Swetha, MBA (hr)
http://maddaliswetha.blogspot.com/

2. THE TERM ECONOMICS DEFINE AS
 The word 'economics' comes from two Greek words,
'eco' meaning home and 'nomos' meaning accounts.
 Economics is that branch of knowledge which
studies the processes through which the resource
which are scarce in nature are allocated to satisfy
the unlimited wants of the people.
 In other words, the economics of the individual
agent's decisions about resources is referred to as
microeconomics, while macroeconomics studies the
interactions in the economy as a whole.

3. WHAT IS MICRO AND MACRO ECONOMICS?
 Micro Economics talks about the actions of
an individual unit, i.e. an individual, firm,
household, market, industry, etc.
 Macro Economics studies the economy as a
whole, i.e. it assesses not a single unit but
the combination of all i.e. firms, households,
nation, industries, market, etc.

4. DIFFERENCE BETWEEN
MICRO AND MACRO ECONOMICS
 Meaning:
 Microeconomics is the branch of economics that
studies the behavior of an individual consumer,
firm, family is known as Microeconomics.
 Macroeconomics is the branch of economics that
studies the behavior of the whole economy, (both
national and international) is known as
Macroeconomics.

5. DIFFERENCE BETWEEN
MICRO AND MACRO ECONOMICS
 Microeconomics deals with individual economic
variables.
 Macroeconomics deals with Aggregate economic
variables.
 Business Application:
 Microeconomics is applied to operational or internal
issue.
 Macroeconomics environment and external issues.

6. DIFFERENCE BETWEEN
MICRO AND MACRO ECONOMICS
 Tools:
 Microeconomics is the demand and supply. And
Macroeconomics is the Aggregate Demand and
Aggregate Supply.
 Assumption of Microeconomics:
 It assumes that all macro-economic variables are
constant.
 Assumption of Macroeconomics:
 It assumes that all micro-economic variables are
constant.

7. DIFFERENCE BETWEEN
MICRO AND MACRO ECONOMICS
 Microeconomics: Theory of Product Pricing, Theory
of Factor Pricing, Theory of Economic Welfare.
 Macroeconomics: Theory of National Income,
Aggregate Consumption, Theory of General Price
Level, Economic Growth.

8. DIFFERENCE BETWEEN
MICRO AND MACRO ECONOMICS
 Scope:
 Microeconomics it covers various issues like
demand, supply, product pricing, factor pricing,
production, consumption, economic welfare, etc.
 Macroeconomics it covers various issues like,
national income, general price level, distribution,
employment, money etc.

9. DIFFERENCE BETWEEN
MICRO AND MACRO ECONOMICS
 Importance of Microeconomics: It is helpful in
determining the prices of a product along with the
prices of factors of production (land, labor, capital,
entrepreneur etc.) within the economy.
 Importance of Macroeconomics: It maintains
stability in the general price level and resolves the
major problems of the economy like inflation,
deflation, reflation, unemployment and poverty as a
whole.

10. DIFFERENCE BETWEEN
MICRO AND MACRO ECONOMICS
 Limitations of Microeconomics: It is based on
unrealistic assumptions, i.e. In microeconomics it is
assumed that there is a full employment in the
society which is not at all possible.
 Limitations of Macroeconomics: It has been
analyzed that 'Fallacy of Composition' involves,
which sometimes doesn't proves true because it is
possible that what is true for aggregate may not be
true for individuals too.

11. CONCLUSION OF
MICRO AND MACRO ECONOMICS
Every coin has two aspects:
 micro and macroeconomics are the two aspects of
the same coin, also they cover the whole economy of
a country.
 Remember, this a important point that which
makes them different is the area of application.

12. THANK YOU
 Paper presentation made by Maddali Laxmi
Swetha.
 Maddali Swetha Blog -
http://maddaliswetha.blogspot.com/
 https://in.linkedin.com/in/maddali-swetha
 https://twitter.com/maddali_swetha
 E-Mail ID: maddali_swetha@yahoo.com