Microeconomics and macroeconomics are the two main branches of economics, distinguished by their scale and focus. While microeconomics analyzes the decisions of individuals and firms, macroeconomics looks at the economy as a whole. Both are vital for understanding the economy, as they influence and complement one another.
Lionel Robbins defined economics as "the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses". Its key characteristics are: human wants are unlimited, resources are scarce, and these scarce resources have alternative uses, which necessitates making choices and experiencing opportunity costs. This definition emphasizes the universal nature of economic problems arising from scarcity, rather than focusing on material wealth or welfare.
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