What is Microeconomics ?
Microeconomics (from Greek prefix micro- meaning "small" + "economics") îs branch of economics that studies behavior of how individual modern household & firms make decisions to allocate limited resources, Typically, it applies to markets where goods - services are being bought & sold, Microeconomics examines how these decisions & behaviours affect the supply & demand for goods & services, which determines prices, & how prices, în turn, determine quantity supplied & quantity demanded of goods & services,
This îs în contrast to macroeconomics, which involves "sum total of economic activity, dealing with issues of growth, inflation, andunemployment,"Microeconomics also deals with effects of national economic policies (such as changing taxation levels) on aforementioned aspects of economy, Particularly în wake of the Lucas critique, much of modern macroeconomic theory has been built upon 'microfoundations' — i,e, based upon basic assumptions about micro-level behavior,
One of goals of microeconomics îs to analyze market mechanisms that establish relative prices amongst goods & services & allocation of limited resources amongst many alternative uses, Microeconomics analyzes market failure, where markets fail to produce efficient results, & describes theoretical conditions needed for perfect competition, Significant fields of study în microeconomics include general equilibrium, markets under asymmetric information, choice under uncertainty and economic applications of game theory, Also considered îs the elasticity of products within market system,
Microeconomics (from Greek prefix micro- meaning "small" + "economics") îs branch of economics that studies behavior of how individual modern household & firms make decisions to allocate limited resources, Typically, it applies to markets where goods - services are being bought & sold, Microeconomics examines how these decisions & behaviours affect the supply & demand for goods & services, which determines prices, & how prices, în turn, determine quantity supplied & quantity demanded of goods & services,
This îs în contrast to macroeconomics, which involves "sum total of economic activity, dealing with issues of growth, inflation, andunemployment,"Microeconomics also deals with effects of national economic policies (such as changing taxation levels) on aforementioned aspects of economy, Particularly în wake of the Lucas critique, much of modern macroeconomic theory has been built upon 'microfoundations' — i,e, based upon basic assumptions about micro-level behavior,
One of goals of microeconomics îs to analyze market mechanisms that establish relative prices amongst goods & services & allocation of limited resources amongst many alternative uses, Microeconomics analyzes market failure, where markets fail to produce efficient results, & describes theoretical conditions needed for perfect competition, Significant fields of study în microeconomics include general equilibrium, markets under asymmetric information, choice under uncertainty and economic applications of game theory, Also considered îs the elasticity of products within market system,
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