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 |
Popular Questions of Class 12 Macro Economics
- Q:-
Differentiate between devaluation and depreciation.
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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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Explain the relation between government deficit and government debt.
- Q:-
From the following data, calculate Personal Income and Personal Disposable Income.
Rs (crore)
(a) Net Domestic Product at factor cost 8,000
(b) Net Factor Income from abroad 200
(c) Undisbursed Profit 1,000
(d) Corporate Tax 500
(e) Interest Received by Households 1,500
(f) Interest Paid by Households 1,200
(g) Transfer Income 300
(h) Personal Tax 500 - Q:-
Why should the aggregate final expenditure of an economy be equal to the aggregate factor payments? Explain.
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Give the relationship between the revenue deficit and the fiscal deficit.
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Discuss the issue of deficit reduction.
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Are fiscal deficits inflationary?
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What is the difference between ex ante investment and ex post investment?
Recently Viewed Questions of Class 12 Macro Economics
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Discuss some of the exchange rate arrangements that countries have entered into to bring about stability in their external accounts.
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What is a ‘legal tender’? What is ‘fiat money’?
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Suppose it takes 1.25 yen to buy a rupee, and the price level in Japan is 3 and the price level in India is 1.2. Calculate the real exchange rate between India and Japan (the price of Japanese goods in terms of Indian goods). (Hint: First find out the nominal exchange rate as a price of yen in rupees).
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What is the marginal propensity to import when M = 60 + 0.06Y? What is the relationship between the marginal propensity to import and the aggregate demand function?
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Would the central bank need to intervene in a managed floating system? Explain why.
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We suppose that C = 70 + 0.70Y D, I = 90, G = 100, T = 0.10Y (a) Find the equilibrium income. (b) What are tax revenues at equilibrium income? Does the government have a balanced budget?
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The value of the nominal GNP of an economy was Rs 2,500 crores in a particular year. The value of GNP of that country during the same year, evaluated at the prices of same base year, was Rs 3,000 crores. Calculate the value of the GNP deflator of the year in percentage terms. Has the price level risen between the base year and the year under consideration?
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Distinguish between stock and flow. Between net investment and capital which is a stock and which is a flow? Compare net investment and capital with flow of water into a tank.
- Q:-
Differentiate between balance of trade and current account balance.
- Q:-
Differentiate between devaluation and depreciation.
- NCERT Chapter