Published by: sadikshya
Published date: 17 Jun 2021
Macroeconomics is that part of economic theory that studies the economy in its totality or as a whole. It studies not individual economic units like a household, a firm, or an industry but the whole economic system. Macroeconomics is the study of aggregates and averages of the entire economy. The Uses of Macroeconomics are briefly described below.
1 For making business decisions.
To understand the operation of a state-controlled economy.
Pricing, forecasting, administrative, financial, and other policies.
Based on the trend of macroeconomic variables.
The investment climate, price trends, relation with other countries, government economic policies, etc.
2 Uses of macroeconomics are applied in economic planning (concerned with aggregate variables.
Economic planning is the process through which we can make the decisions of what and how it is to be produced through controlling and managing the economic activity. It is an economic program speculated for the development of the regional economic system.
3 Development of Microeconomics theories.
Macroeconomics evolves with the evolution of the economy. Macroeconomic theories change over time. They keep on changing because major economic events — such as the Great Depression of the 1930s the Great Inflation of the 1970s — bring into focus problems within a prevailing theory. Eventually, the theory is modified.
4 Making international comparisons on the economic level.
International comparisons, or national evaluation indicators, focus on the quantitative, qualitative, and evaluative analysis of one country in relation to others. Often, the objective is to compare one country’s performance to others in order to assess what countries have achieved
Limitations of Macroeconomics
Macroeconomics Indicators