1.1.3 Scope of economics: Micro and macro economics

The scope of economics is quite extensive, as it encompasses a wide range of topics and areas of study. The primary objective of economics is to understand and explain how societies allocate their scarce resources to satisfy human wants and needs. As a result, economics covers the following key areas:

1. Microeconomics: Microeconomics focuses on the behavior of individual economic agents, such as consumers, households, firms, and industries. It examines how these agents make decisions regarding production, consumption, and pricing of goods and services. Key topics in microeconomics include demand and supply analysis, market structures (perfect competition, monopoly, oligopoly, etc.), consumer behavior, and resource allocation.
2. Macroeconomics: Macroeconomics deals with the economy as a whole and studies aggregate economic variables such as GDP, inflation, unemployment, and overall economic growth. It aims to understand the factors that influence the overall performance of an economy and the role of government policies in stabilizing and promoting economic growth