Question

Compare and contrast microeconomics with macroeconomics.

Although managerial economics is based primarily on microeconomics,
explain why it is also important for managers to understand
macroeconomics.

Answer 1

Microeconomics focuses on individual economic agents, such as households and firms, while macroeconomics looks at the economy as a whole. Managerial economics is based on microeconomics, but it is also important for managers to understand macroeconomics because economic trends and policies at the national and global levels can have a significant impact on their operations.