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Microeconomics is the study of the economy of a small group, county, a market, country, or an individual. Macroeconomics is the study of the international and national economy including all the individuals involved in the microeconomics. under the microeconomic level, we study issues affecting individuals such as product’s demand and supply ,those affecting companies such as company`s production levels and issues affecting the market such as market competition. Macroeconomics not only does it deal with the above issues but it goes an extra mile and deals with issues such as exports and imports, GDP and even unemployment rates. Microeconomics and macroeconomics have similar principles but macroeconomics deal with a far larger scale in comparison with microeconomics.
Inflation is mainly studied in the macroeconomics but its effect will also be experienced at the microeconomic level. Inflation leads to increment of prices of goods and services, thereby adversely affecting individuals and businesses. Subsequently, business owners will increase the salaries of their employees to meet their daily cost of living.
Unemployment rate being an issue studied under macroeconomic level, it indirectly affects the buying habits of individuals, a factor under microeconomics. I can conclude that the relationship between macro and microeconomics is interdependent.
Microeconomics deals with issues affecting individuals on a daily basis. Decisions made at the lower level by businesses and individuals determines the results of microeconomics studies. For example, if a certain company decides to increase employees` wages, consequently, the cost of production will increase and prices of the products will also rise. For students, they can get Macroeconomics homework help from our experts to help them boost their grades.
Individuals use microeconomics in prediction of the effects of their decisions making. For example, a company can purchase an automated machine so as to reduce the workforce. In the long run their benefits will be increased.
A macroeconomist is interested in understanding how low interest rates will affect both national housing costs and the unemployment rate. A macroeconomist will also be interested in understanding how taxes affect a country or a region’s economy. To understand the above factors, an economist should study both the national income and the Gross Domestic Product ( GDP) .
Microeconomic principles like the elasticity of demand is also used in macroeconomic study.
Macroeconomics and macroeconomics affect each other. For example, introduction of a new technology will affect the individuals and the nations as well. For instance, the introduction of Youtube is facilitating bridging the unemployment gap which is a macroeconomic issue.
Market issues are under microeconomic studies but markets can be huge enough to affect both the national and international economy.
In conclusion, since the two fields that are microeconomics and macroeconomics are interdependent on each other, economists should be well conversant with both of them. Microeconomic studies could be collectively used to predict the national and international economy.