Question

Discuss with examples the two broad divisions of Economics. You are required to support
your explanations with examples.

Answer 1

Economics can be defined as the study of the ownership, use, and allocation of scarce resources. The two broad divisions of Economics include the micro-economics and macro economics. Macro economics analyses the economy as an aggregate (such as aggregated production, consumption, savings, and investment) and diversified concerns impacting it. Example of macro-economic includes the unemployment, inflation, GDP, interest rates, political-legal, technological, and international concerns. On contrast the micro-economics analyses and examines the behaviour of basic elements in the economy, inclusive of the sole agents (such as buyers, households, firms, and sellers) and markets, their interactions as well the outcomes of those interactions. Example of micro-economics are increasing taxes and cutting spending