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Microeconomics concepts greatly help us to understand the broad aggregates which are used in Macroeconomics to understand the overall functioning of an economy but are there any ways in which Macroeconomics help us to understand the behavior of individual units?

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[...] are there any ways in which Macroeconomics help us to understand the behavior of individual units?

Putting aside the totological cases in which a utility would directly integrate macroeconomic signals such as, e.g. key-rates, AFAIK, no there are not.

As you mention, Macroeconomics is about aggregate level considerations and/or identities That being said, you will find theoretical frameworks, such as General Equilibrium Theory that imply/represent microfounded behaviours with the intention of adding them up instead of directly dealing with accounting-like macro aggregates.

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  • $\begingroup$ Any question @Varun ? $\endgroup$ – keepAlive Sep 8 at 23:28
  • $\begingroup$ Thanks @keepAlive for your answer. However, in the meantime I read about law of diminishing marginal utility which seems to be using macroeconomics to explain a microeconomic concept. I would request you to please tell me your thoughts on it whether I am thinking correctly or not. Thank you, again! $\endgroup$ – Varun Singh Sep 9 at 0:15
  • $\begingroup$ You are welcome @Varun. The law of marginal diminishing returns has actually been "discovered" by David Ricardo (microeconomist) and Thomas Maltus, who implies it to explain production (of food), which itself is explained with microfounded formalisms see Production Theory and Industrial Organisation Theory. Actually, as soon as you model an entity that has an optimization program "in mind", you are "using" micro theory. Any question? $\endgroup$ – keepAlive Sep 9 at 7:14
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    $\begingroup$ Thank you, @keepAlive. your response lended me a lot of clarity. Grateful! $\endgroup$ – Varun Singh Sep 9 at 15:32

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