Economic Growth

Economic growth can be defined as the growth of the inflation-adjusted market value of the goods and services generated over time by an economy. Growth is typically expressed in real terms-i.e., inflation-adjusted terms-to eliminate the distorting impact of inflation on produced consumer prices. Microeconomics is an economic branch that studies the conduct of individuals and companies in making decisions about the distribution of scarce resources and their interactions. One aim of microeconomics is to examine the dynamics of the market that determine relative prices between goods and services and distribute limited resources between alternatives. Microeconomics demonstrates circumstances under which free-market allocations are attractive. It also analyzes market failure where productive results are not achieved by the markets. Although microeconomics focuses on companies and individuals, macroeconomics focuses on total economic activity, addressing issues of growth, inflation, and unemployment, and national policies on these issues. Microeconomics also discusses the impact of economic policies (such as raising tax levels) on microeconomic behavior, and hence on the above-mentioned economic aspects.