Class 12 Macro Economics - Chapter Introduction to Macro Economics NCERT Solutions | What is the difference between microecon
What is the difference between microeconomics and macroeconomics?
The difference between microeconomics and macroeconomics are:
| Point of Difference | Microeconomics | Macroeconomics |
|---|---|---|
| Definition | It is a branch of economics that studies the Economic variables at an individual level like the households, the firms, the consumer etc. | It is a branch of economics that studies the economics variables of an economy as a Whole. |
| Deals with | It deals with how consumer or the producers make decisions depending on their given budget and other variables. |
It deals with how different economics sectors like households, industries and other government and foreign sectors make their decisions. |
| Method | The method of partial equilibrium (i.e. equilibrium is one market) is used. | The method of general equilibrium (i.e. equilibrium in all the markets, simultaneously) is used. |
| Variables | The major variables involved are prices, consumers demand, wages, rent, profit, firms, revenue, cost etc. | The major variables involved are aggregate demand, aggregate supply, inflation, unemployment, poverty, etc. |
| Theories |
Various theories studied are: 1. Theory of consumers behaviour and demand |
Various theories studied are 1. Theory of national income 2. Theory of money 3. Theory of general price level 4. Theory of employment 5. Theory of international trade |
| Popularised by | Alfred Marshal | Keynes |
More Questions From Class 12 Macro Economics - Chapter Introduction to Macro Economics
Popular Questions of Class 12 Macro Economics
- Q:-
What is marginal propensity to consume? How is it related to marginal propensity to save?
- Q:-
Explain why public goods must be provided by the government.
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Differentiate between balance of trade and current account balance.
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What are the four factors of production and what are the remunerations to each of these called?
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What is a barter system? What are its drawbacks?
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What is the difference between ex ante investment and ex post investment?
- Q:-
Distinguish between revenue expenditure and capital expenditure.
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What are official reserve transactions? Explain their importance in the balance of payments.
- Q:-
Why should the aggregate final expenditure of an economy be equal to the aggregate factor payments? Explain.
- Q:-
What are the main functions of money? How does money overcome the shortcomings of a barter system?
Recently Viewed Questions of Class 12 Macro Economics
- Q:-
Suppose the GDP at market price of a country in a particular year was Rs 1,100 crores. Net Factor Income from Abroad was Rs 100 crores. The value of Indirect taxes – Subsidies was Rs 150 crores and National Income was Rs 850 crores. Calculate the aggregate value of depreciation.
- Q:-
What is the difference between ex ante investment and ex post investment?
- Q:-
What is a barter system? What are its drawbacks?
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Write down some of the limitations of using GDP as an index of welfare of a country.
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Calculate the open economy multiplier with proportional taxes, T = tY, instead of lump-sum taxes as assumed in the text.
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What are the alternative definitions of money supply in India?
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What is a ‘legal tender’? What is ‘fiat money’?
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Distinguish between the nominal exchange rate and the real exchange rate. If you were to decide whether to buy domestic goods or foreign goods, which rate would be more relevant? Explain.
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What is money multiplier? What determines the value of this multiplier?
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Suppose C = 100 + 0.75Y D, I = 500, G = 750, taxes are 20 per cent of income, X = 150, M = 100 + 0.2Y . Calculate equilibrium income, the budget deficit or surplus and the trade deficit or surplus.
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