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It defines its scope by analysing the success and failure of government efforts. Macroeconomics studies the relationship between countries and how one country’s actions affect the other. Macroeconomics measures and interprets the difficulties that an economy faces, as well as the progress that it achieves. It examines the economy on a huge scale, taking into account a variety of economic difficulties. Macroeconomics is a discipline of economics that provides a comprehensive view. Recommended: Advantages and Disadvantages of shopping online Meaning Of Macro Economics Comparison between Microeconomics And Macroeconomics

As a consequence, economic equilibrium is achieved. It concludes that in a completely competitive market, the price requested by consumers is the same as the price offered by producers. Price theory: The theory of supply and demand, which is used to establish prices in a competitive market, is created by combining utility and production theory. Producers seek choices that allow them to select a set of inputs as well as strategies for combining them to reduce costs and maximize profit.ĭ. Production theory: Production theory is the study of manufacturing or the process of transforming inputs into outputs. However, they are limited by the amount of money they have available to spend.Ĭ.

It states that customers will choose the combinations of products and services that provide them with the most satisfaction or utility. Utility theory: This concept explains why people behave the way they do.