Economics is the study of how society manages its scarce resources.

Economist is one who examines how people make choices on scarce resources.

The common decisions faced by people:

How much will they work?
What will they buy?
How much will they save?
How will they invest their savings?

Microeconomics is the study of how households and firms make decisions and interact in markets.

A microeconomist might study the effects of rent control on housing in a major city, impact of foreign competition on a particular U.S. industry, or effects of education on worker's earnings.

Macroeconomics is the study of economy-wide phenomena, such as inflation, unemployment, and economic growth.

A macroeconomist might study the effects of borrowing by the federal government, changes in the economy's unemployment, or effects of rising inflation.

Microeconomics and Macroeconomics are similar when applying the laws of supply and demand. They differ in that Microeconomics focuses on firms and households while Macroeconomics focuses on national economic phenomena.

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