Question

What are the two basic types of economies? in macroeconomics

Answer 1

Two major types of economics are microeconomics, which focuses on the behavior of individual consumers and producers, and macroeconomics, which examine overall economies on a regional, national, or international scale.

Consumer behavior in Economics describes how consumers allocate incomes among different goods and services to maximize their utility. Here consumer behavior is best understood in three distinct steps - consumer preferences, budget constraints, and consumer choices. Consumers create demand for goods and services. When prices are high, consumers buy less. When prices are low, consumers buy more. Producers can make or sell almost anything they want. Consumers can buy what they want.

Macroeconomics is the branch of economics that studies the behavior and performance of an economy as a whole. It focuses on the aggregate changes in the economy such as unemployment, growth rate, gross domestic product, and inflation. There are three main types of government macroeconomic policies are fiscal policy, monetary policy, and supply-side policies. Other government policies including industrial, competition, and environmental policies. Price controls, exercised by the government, also affect private sector producers.