We all remember the famous definition of economics by Lionel Robbins, “Economics is a science which studies human behavior as a relationship between ends and scarce means which have alternative uses”.
The branches of economics are divided into micro and macro. Micro-economics is concerned with the study of all the economic action of individuals, and small groups of individuals. The study of a particular firm, industry, commodity, household, etc.
Macro-economics is concerned with the study of aggregate of these quantities [not with individual incomes, but with national income; not with individual price but with the general price levels; not with individual output but with national output.
Macro-economics depends on micro-economics because it is from micro-economics that we have macro-economics i.e. it is from a part that we got the whole.
Some macro-economics issue may not relate to micro-economics issues e.g. an individual can invest without having to save or save without investing but for the whole economy saving and investment must be equal.
In reality, a hard line cannot be drawn between micro and macro economics analysis. Therefore, a truly general theory of economics must embrace both.
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