Microeconomics: “is the study of the decisions of individual people and businesses.”
Macroeconomics: “is the study of the national economy and the global economy.”
Microeconomics tries to explain how the taxes affect the prices and quantities of individual goods and services. Macroeconomics studies how government regulation affects the whole market as a whole, such as income, jobs and so on...
Economic Science
Like a laboratory for chemist, economists can build models and test the experiment in order to predict the economy accurately. There are three steps involved: Observation, model build-up, testing models. However, different from a laboratory, you can not separate out one factor and keep the other unchanged. What economists do is to compare two things where there is one factor different and seek out the effects of the factor.
Sometimes we make a wrong conclusion due to some common “fallacies”.
The first is you can’t make what is correct for parts also correct for the whole and vice verse. Another is you can not conclude causes and effects according to the time. A lot of things economists are controversial on. However, on some of the issues, they will agree with each other. For example, the effect of taxes, and the way to reach welfare...
