Question

Answer the following question
Explain the meaning of Micro Economics with the help of few important definitions.

Answer 1

Microeconomics is the study of the issues pertaining to individual economic units, basically consumers and firms, which interact in the market of different goods and services. It studies how consumers make their consumption choices and decisions, given their incomes and prices of goods and services. Similarly, it analyses how firms decide how much to produce by using different input combinations. The basic focus of this study is the determination of prices in the commodity markets and factor markets. The meaning of microeconomics can be better understood with the help of the following definitions.
According to Prof. K. E. Boulding, “Micro Economics is the study of particular firm, particular household, individual prices, wages, incomes, individual industries and particular commodities.” In the words of Maurice Dob, “Micro economics is in fact a microscopic study of the economy.”