In English Language microeconomics is the study of small business and macroeconomics is the study of business or trade in general. Micro is a micro view of the economy while macro is a macro view. Micro is more concerned with individual consumers, while the macro is concerned with the overall economy as a whole. The two types of micro are industrial and household.
Micro is usually studied under macro because it is more concerned with the small industry rather than the big ones. The micro view is quite simple, but it has to be carefully followed because it is not easy to change the overall system without a good reason. There are times when the macro is used for the macro analysis. A business may have a big demand but it cannot fulfill this demand due to the economic policies of the government. It then goes on to produce some products at a low price, which is then sold at high prices.
This is not a good business for the business owner. If you fail to follow the laws then there can be inflation of prices and thus there is also a loss in profit. For example, if a government makes changes in the price of goods, then it has to be followed properly. Also the price of goods are affected by the international market and therefore it has to be studied in such a manner that it helps you to understand these problems and then use them to the advantage.
Micro is the study of the individual consumer. Since the people buy their daily necessities from home, they do not use any machinery for purchasing the things. Therefore, the micro aspect is quite difficult to understand and the whole process becomes much complicated.
On the other hand the macro view of micro is more complex. A large number of industries exist, and they manufacture a wide range of goods and sell them at a high rate. Therefore, there is a high competition among the industries to sell their products at a higher price.
This has a lot of implications in the overall economic system of the country. Therefore it is important to understand both these concepts to a great extent so that we can get the optimum results from the economic policies.
In general, both the theories are quite similar, but there are some differences in each country. However, India is unique, because it has a very fast and modern economy and hence the two theories can be applied in this case quite effectively. One thing that can be mentioned is that it is much easier to understand both the theories if they are studied under one concept.
Micro theory is mainly concerned with the economic policy of a particular area. For instance, if there is a recession in India then the macro theory cannot work on that. However, if you understand the micro theory, you can use the concept of economics and then apply it to the economy of India.