Q.State any four limitations of Macroeconomics.

Macroeconomics' limitations mostly stem from treating diverse individual units as one uniform aggregate.

Macroeconomics, despite its usefulness, has several genuine limitations. (1) It is subject to the FALLACY OF DIVISION — the exact reverse of Microeconomics' fallacy of composition: what is true for the economy as a WHOLE need not be true for every individual unit within it; a rise in the country's average income does not mean every individual's income has risen. (2) Macroeconomic AGGREGATES (like 'national income' or 'the general price level') are themselves not perfectly homogeneous — they combine very different individual goods, incomes and prices, and this combining process loses real information about the individual units. (3) It treats millions of highly DIVERSE individual units as though they were one single, uniform block, a simplification that can obscure genuinely important differences between them. (4) It is LESS USEFUL for analysing a specific individual market or price problem — for instance, it cannot explain why the price of onions specifically rose in one local market last month, a question only …

Students often state the SAME limitation for both branches ('unrealistic assumptions') without identifying the SPECIFIC fallacy that applies to each — fallacy of c …