#Microeconomics is the study of particular markets, and segments of the economy. It looks at issues such as consumer behaviour, individual labour markets, and the theory of firms.








#Macro economics is the study of the whole economy. It looks at ‘aggregate’ variables, such as aggregate demand, national output and inflation.





#Micro economics is concerned with:
Supply and demand in individual markets
Individual consumer behaviour. e.g. Consumer choice theory
Individual labour markets – e.g. demand for labour, wage determination
Externalities arising from production and consumption. e.g. Externalities
Macro economics is concerned with

Monetary / fiscal policy. e.g. what effect does interest rates have on the whole economy?
Reasons for inflation and unemployment.
Economic growth
International trade and globalisation

Reasons for differences in living standards and economic growth between countries.
Government borrowing
Moving from Micro to Macro
If we look at a simple supply and demand diagram for motor cars.



Microeconomics is concerned with issues such as the impact of an increase in demand for cars.

increase-demand
This micro economic analysis shows that the increased demand leads to higher price and higher quantity.