Question

Using common layman terms how does the macroeconomy work?

Answer 1

Answer -

There are two branches of economics. Micro economics and Macro economics. They both concentrate on how the market economy functions.Micro economics related with individual approach or individual problem.Macro economics deals with collective or aggregate approach and consider about the national economic problems.

Macro economics is the study of overall units in the economy. According to Layman Micro economics studies all macro economic indicators and factors that influence the economy .In micro economy only specific study of one industry is conducted regarding its cost ,revenue, production strategy, supply of factors of production etc.only for that industry only.But in macro economics overall indusrial sector including all industries are included.Agreegate study of all industries are conducted .Their all problems are determined collectively and not individually. All industrial problems with regarded to country's economic growth will considered. proper solutions to all these problems in the light of increased national output, productivity , human resource development is given in Macro economics.In Macro economics all economic challages at national level like unemployment , poverty, illiteracy, population etc are discussed and proper measures are also suggested. Import export strategy for sufficient inflows and outflows of foreign exchange is also included in macro economics.