Question

What is meant by Macro Economics?

Hint:

Think of Microeconomics as looking at a single tree, while Macroeconomics looks at the entire forest.

Answer 1

Step 1: Understanding the Concept:
The term "Macro" is derived from the Greek word 'Makros', meaning large.
Instead of individual markets, it focuses on aggregate variables.
Step 2: Detailed Explanation:
Macroeconomics examines economy-wide phenomena such as:
1. National Income and GDP: Total output of a country.
2. Inflation: The general rise in price levels.
3. Unemployment: The state of the labor market.
4. Balance of Payments: A country's transactions with the rest of the world.
It helps in formulating government policies like fiscal and monetary policy.
Step 3: Final Answer:
Macroeconomics deals with total aggregates like total employment, national income, total investment, and general price level.