Branches of Economics - Theoretical Economics Homework Help

Branches of Economics

1. Microeconomics

Definition: Microeconomics studies the economic decision making of the firms and individuals in the market setting.

The issues which are studied under Microeconomic analysis are as follows: -

a)      How the consumers behave.

b)      How business firms makes the choice.

c)      How the prices are designed in the markets.

d)     How taxes and price controls have an effect on consumers and producers.

e)      How the structure of the markets affect economic performance.

f)       How wages, interest rates, rent and profits are determined.

g)      How income is distributed among families. 

2. Macroeconomics

Definition:  Macroeconomics is the studying of the economy as a whole and it concerns the relationship amid aggregate (total) measures.

The issues which are studied under macroeconomic analysis are: -

a)      The National Income.

b)      Money supply and money demand of the Nation.

c)      Value of the money.

d)     Inflation and the determinants of it.

e)      Macroeconomic objectives for instance full employment, price stability, Balance of Payments and Economic growth. 

f)       Government policies such as Monetary and Fiscal Policies.

g)      Public Finance such as Government profits and expenditure.

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