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How does microeconomics relate to macroeconomics?

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How does microeconomics relate to macroeconomics?
posted Jul 11, 2017 by Anushka

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Macroeconomics focuses on the system as a whole. Microeconomics focuses on the interactions between individual actors. They are the two main sub-fields of the greater field of economics, and use similar approaches to solving pretty different problems. Macroeconomics looks at what's generally thought of as "the economy." Unemployment, growth, recessions, etc.

Microeconomics would model things like competition between two firms, interactions between buyers and sellers, pricing, etc. Micro tends to have much broader applications, since it's essentially kind of just a formalized analysis of mechanisms and effects that can be used to model all kinds of situations.

answer Jul 12, 2017 by Debolina Charaborthy