Microeconomics vs Macroeconomics Quiz

Branches of Economics

• The two fundamental branches of economics are Microeconomics and Macroeconomics, which study different aspects of the economy at different levels of aggregation.

Origin of Micro and Macro Terms

• The terms 'Micro' and 'Macro' in economics were first used by Ragnar Frisch in 1933.

Focus of Microeconomics

• Microeconomics focuses on the study of individual economic units such as individuals, households, and firms, examining how they make decisions regarding the allocation of resources.
• Microeconomics does not focus on the study of the economy at a large scale, but rather at a smaller, more individual level.

Theories in Micro Economics

• The scope of Micro Economics includes three main theories: (not specified in the provided text, but typically including Consumer Theory, Production Theory, and Market Structure Theory).

Resource Allocation

• Microeconomics helps determine the allocation of resources by analyzing how individuals, households, and firms make decisions regarding the allocation of resources.

Assumptions of Microeconomics

• Microeconomics is not based on the assumptions of 'full employment' and 'marginal analysis' (the text incorrectly stated this; microeconomics often assumes imperfect competition and does not assume full employment).

Price Determination

• Microeconomics plays a significant role in analyzing how prices are determined in markets.