Macroeconomics/Macroeconomics (intro)
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[edit] What is Economics
Simply put, economics is the study of the allocation of scarce resources to satisfy competing ends[1]. In general, this applies mainly to microeconomics. This is because in Macroeconomics, there are many situations where resources are not scarce.
[edit] Microeconomics vs Macroeconomics
Microeconomics applies to small elements of an economy. This may be trade between two people, or trade between two countries. It usually focuses on a small basket of goods being traded between a small group of agents. On the other hand, Macroeconomics is the study of an entire economy. It looks at aggregate inputs and outputs with the goal to understand the flows of total consumption, employment rates, wages, prices and many other aggregate parts of an economy. In macroeconomics we look at both the long run and short run changes in the economy.
[edit] Main Questions
The study of Macroeconomics looks to solve one broad question:
- What Causes Economic Growth?
In pursuit of solving this question, macro economists look at causes of business cycles, inflation, employment and many other aspects of the economy.
[edit] Notes
- ↑ Quoted from Gary Becker
