| Definition |
Study of individual economic units such as consumers, firms, and markets. |
Study of the economy as a whole, including national income, inflation, and unemployment. |
| Focus |
Individual decisions and resource allocation at a small scale. |
Aggregate economic phenomena and large-scale economic policies. |
| Key Topics |
Demand and supply, pricing, elasticity, production, and consumer behavior. |
GDP, inflation, fiscal and monetary policy, unemployment, and economic growth. |
| Units Analyzed |
Households, businesses, and specific industries. |
Entire economy or major sectors like government and banking. |
| Tools Used |
Partial equilibrium analysis, marginal analysis. |
Aggregate models, national income accounting, IS-LM and AD-AS models. |
| Goal |
Optimize resource allocation and understand individual market behavior. |
Achieve economic stability and growth at a national or global level. |
| Policy Application |
Helps firms set prices and governments regulate markets. |
Helps central banks and governments design economic policy. |
| Scope |
Narrow; focuses on specific markets or issues. |
Broad; covers entire economic systems. |
| Economic Agents |
Consumers, producers, and workers. |
Governments, central banks, and aggregate demand/supply. |
| Time Horizon |
Short-term and specific decision-making contexts. |
Often long-term trends and cyclical behavior. |
| Examples |
Pricing of smartphones, consumer choice in grocery shopping. |
Changes in national GDP or unemployment rates over time. |
| Data Focus |
Micro-level data: individual, firm, or market-specific data. |
Macro-level data: national income, inflation indexes, etc. |
Microeconomics vs Macroeconomics