Q2.

(a) “Microeconomics studies the particular market segment of an economy,

whereas macroeconomics studies the whole economy that covers several market
segments”.  Explain the statement. Differentiate between microeconomics and
macroeconomics. 6

Microeconomics

Microeconomics is a Greek word. Which comes from Greek prefix mikro- meaning "small" and the
economics. It is a branch of economics that studies the behavior of individuals and firms in making
decisions regarding the allocation of scarce resources and the interactions among these individuals and
firms. Microeconomic mainly dealings with a single rational and utility maximizing individual.
Microeconomics in brief concern essentially with single/individual or segment of market in nature. It is
generally less than a nation.

Example: Puja’s per year income is 1 crore taka, Income of Mamun and Fakir Mansion etc. all are
dealing with individual .Therefore, they are Microeconomics subject.
Macroeconomics
Macroeconomics is also a Greek word. Which comes from the Greek prefix makro- meaning "large" and
economics. It is a branch of economics dealing with the performance, structure, behavior, and decision-
making of an economy as a whole. This includes regional, national, and global economies.
Macroeconomists study topics such as GDP, unemployment rates, national income, price indices, output,
consumption, unemployment, inflation, saving, investment, energy, international trade, and international
finance. Macroeconomics covers whole economy that covers several market segment.

Example: GDP of Bangladesh, Income of Garments sector in 2020 etc. Which covers whole or several
market segments.

Difference between Micro and Macroeconomics

Seria Micro Economics Macro Economics

l
1. It Studies the individual unit/market It studies the whole economy or large
groups (GDP)
2. Laws related to marginal analysis are included Deals with whole economy like
employment, public finance, national
income etc. are included in its scope
3. Provides information related to the individual prices, Provides information relating to national
individual consumptions ,supply, elasticity and production, income, total output, total consumption
,inflammation, budget, and price
4. Its analysis is very simple It is complex due to the study of large
groups.
5. Studies individual problems and it is less important Studies the problems relating to the
economy and its growth
6. Particularly focuses on price analysis Focuses on income analysis
7. Supply of goods Productive capacity of economy
8. Microeconomics is also called price theory essentially Macroeconomics deals with the income
individual level. analysis of the country.