2 Answers
Like the first part of the word suggests, macro means big or broad, hence, macroeconomics is the part of the economy that encompasses the broad picture. For example, the lowering of the interest rate typically makes money cheaper to borrow and should encourage companies to borrow more money to hire employees and vice versa. Microeconomics would be part of the economy that's micro or small. For example, Walmart's decision to hire an additional 5000 people would be a microeconomics decision, or simply put, a decision impacting mostly the Walmart company as opposed to the entire economy.
To put it in a sentence:
"The decisions by the federal government to lower or increase interest rates would be considered a macroeconomics decision and these choices would tend to impact the economy as a whole."
Hope this helps, POOHBEBY.
12 years ago. Rating: 2 | |