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Economics is a social science concerned with the production, distribution, and consumption of goods and services. It studies how individuals, businesses, governments, and nations make choices about how to allocate resources.
Economics can generally be divided into macroeconomics, which is focused on the behavior of the economy as a whole, and on microeconomics, which is focused on individual people and businesses.
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1. Study of aggregates - Macro-economics deals with studying a nation's economy as a whole. The scope of Macro Economics is broad. Macroeconomics is concerned with the study of aggregates. It is concerned with a concept such as Aggregate Demand, Aggregate Supply, Total Output, General Price Level, National Income, etc.
2. Lumping method - Macro analysis deals with the behavior of aggregates. It uses lumping to deal with macro variables such as aggregate supply and demand, national output, etc. Macroeconomics uses a lumping method for economic study. Under the lumping way, we study the general price level and not the prices of individual products.
3. A General Equilibrium Analysis - Analysis deals with the entire economy in the context of equilibrium. Macroeconomics is concerned with the behavior of aggregates and their interdependence. It is a general equilibrium analysis in which everything depends on everything else. For instance, a change in income level may result in a change in savings, which may influence investment.
4. Income Analysis - The income theory is a significant aspect of macroeconomics theory. A significant task of macroeconomics is the determination of national income. Macroeconomics studies the factors determining national income and the causes of the trends in national income
5. Policy-oriented - Analysis helps formulate suitable economic policies to promote economic growth, generate employment, etc. The study of macroeconomics is highly useful for the formulation and implementation of the government’s economic policies. The government is concerned with regulating aggregates of the financial system, such as the general price level, the general level of production, employment level, and so on.
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