Q.Distinguish between microeconomics and macroeconomics with one example of each.

The distinction turns on the level of study — the individual unit versus the whole economy.

Microeconomics studies the behaviour of individual economic units — a single consumer, a single firm, a single product, or a single market — and how the price of an individual good or factor is determined. It is also called price theory. Example: how the price of wheat is fixed by the demand for and supply of wheat.

Macroeconomics studies the economy as a whole, dealing with aggregates such as national income, total employment, and the general price level. It is also called income and employment theory. Example: the general rate of inflation (rise in the overall price level) in the country.

Key points of difference:

• Unit of study: micro = individual unit; macro = the whole economy.
• Subject matter: micro = individual prices and outputs; macro = aggregates (national income, employment, general price level).
• Alternative name: micro = price theory; macro = income and employment theory. …

A common mistake is giving an example that does not match the level — e.g. offering 'inflation' as a micro example. Anchor each example to its level: …