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Discuss the subject matter of economics.
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: Economics is a subject in and of itself. Economics describes how a person allocates his limited resources to meet his seemingly limitless desires. Economic theory is separated into two branches: Microeconomics and Macroeconomics. According to Ragnar Frisch's hypothesis, this division was established only after 1930.

 Microeconomics is the study of particular economic units, such as consumer and business behaviour. Microeconomics is the study of how people use the resources they have to the best of their abilities in order to achieve their rational goals. It's also the study of supply and demand, and how their interactions influence the prices of various goods and services. Microeconomics aids in the resolution of an economy's three main issues.

It's also known as the Price Theory because it's primarily concerned with how prices are set in commodity and factor markets. The main instruments of analysis are demand and supply in this case. Individual income and expenditure are its primary tools.

Since it encompasses the calculation of wages, rent, interest, and profit, it is also known as Factor theory or micro theory of distribution.

Macroeconomics refers to the study of the economy as a whole. It focuses on how to aggregate metrics, such as aggregate demand, aggregate supply, and overall price level, are determined and how they evolve over time. It's also known as the Income and Employment Theory because it's primarily concerned with how income and employment levels are determined. Macroeconomics aids in the analysis and resolution of issues such as unemployment, inflation, BOP disequilibrium, poverty, and so on. The main instruments of analysis are aggregate demand and aggregate supply.
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