CHAPTER 1 Flashcards
Definition of Economics by Maurice Dobb
Microeconomics is in fact a microscopic study of the economy.
Definition of Economics by Prof. A. P. Lerner
Micro economics consists of looking at the economy through a microscope as it were, to see how millions of cells in the body of economy - the individuals or households as consumers and individuals or firms as producers play their part in the working of the whole economic organism”
Scope of micro economics:
Theory of Product Pricing: Demand and Supply analysis
Theory of Factor Pricing: Rent, Wages, Interest, Profit
Theory of Economic Welfare: Efficiency in Production, Consumption and Overall Economic efficiency.
Features of Micro Economics:
Study of individual units
Price theory
Partial equilibrium
Based on certain assumptions
Slicing Method
Use of Marginalism Principle
Analysis of Market Structure
Limited Scope
Importance of Micro Economics
Price Determination
Free Market Economy
Foreign Trade
Economic Model Building
Business Decisions
Useful to Government
Basis of Welfare Economics
Definition of Macro Economics by J. L. Hansen
Macro economics is that branch of economics which considers the relationship between large aggregates such as the volume of the employment, total amount of savings, investment, national income etc.
Definition of Macro economics by Prof. Carl Shapiro
Macro economics deals with the functioning of the economy as a whole.
Scope of Macro economics:
Theory of income and employment
Theory of General Price Level and inflation
Theory of growth and development
Macro Theory of Distribution
Features of Macro Economics
Study of aggregates
Income theory
General equilibrium analysis
Interdependence
Lumping method
Growth Methods
General Price Level
Policy oriented
Importance of Macroeconomics
Functioning of an economy
Economic Fluctuations
National Income
Economic Development
Performance of an economy
Study of Macro economic variables
Level of employment
