Microeconomics can address questions like these that might have very broad implications for the economy however, questions about aggregate economic numbers remain the purview of macroeconomics, such as what might happen to the gross domestic product (GDP) of China in 2020. Microeconomics could also explain why a higher minimum wage might force The Wendy’s Company to hire fewer workers. stock prices might fall if consumers buy fewer iPhones. Microeconomics could help an investor see why Apple Inc. If a major copper mine collapses in South America, the price of copper will tend to increase, because supply is restricted. If a manufacturer raises the prices of cars, microeconomics says consumers will tend to buy fewer than before. Instead, microeconomics only explains what to expect if certain conditions change. These groups create the supply and demand for resources, using money and interest rates as a pricing mechanism for coordination.Īs a purely normative science, microeconomics does not try to explain what should happen in a market. Individual actors are often grouped into microeconomic subgroups, such as buyers, sellers, and business owners. Microeconomics is the study of economic tendencies, or what is likely to happen when individuals make certain choices or when the factors of production change. Generally speaking, microeconomics is considered a more complete, advanced, and settled science than macroeconomics. Microeconomics shows how and why different goods have different values, how individuals make more efficient or more productive decisions, and how individuals best coordinate and cooperate with one another. If you ever find yourself unable to choose micro or macro, you can always use this article as a refresher.Microeconomics is the social science that studies the implications of human action, specifically about how those decisions affect the utilization and distribution of scarce resources. Don’t forget to check this site any time you have questions about spelling differences or other writing topics. Small differences in spelling can lead to large differences in meaning-even though micro and macro are only different by one letter, they mean opposite things. Remember, micro and tiny are both spelled with the letter I, so identifying the meaning of this word should be easy. They each have a wide variety of uses, but this simple rule holds true for all cases. Is it macro or micro? Macro and micro are terms of measurement that often appear as prefixes to other words. Simply put, micro refers to small things and macro refers to big things.Įach of these terms appears in a wide variety of contexts and refers to a vast number of concepts, but if you remember this simple rule, you will generally be able to remember which is which.Īs an even simpler memory trick, you can use the shared I between micro and tiny to help you remember that micro refers to tiny things. Here is a helpful trick to remember micro vs. On the whole, these two prefixes are hyphenated less frequently than other prefixes, but just to be sure, see our post on prefixes and hyphenation. Lacking economies of scale, the micro-territories have survived by exploiting their one truly worthwhile asset: their sovereignty, the right to do as they please.A depth micrometer measures tiny differences that can be indiscernible to the human eye.On a micro scale, opportunity costs can be very significant.I need to buy a new micro USB cord for my phone, since I left my old one at a bus stop.
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