Scope of Micro Economics

Scope of Micro Economics

1.    Study of Firm & Individual

Microeconomics deals with the individual & firm analyses. Microeconomics explains how individual & firm take decision in the free market.

2.    Resource allocation

Micro Economics deals that how sources are allocated to the production process. Micro economic explains how resources can be effectively utilized to maximize profit of the firm i.e. profit maximization analyses.

3.    Distribution of Goods & Service

Micro economic also studies distribution of Goods & Services to the people.

4.    Equilibrium Attainment

Micro economics study the equilibrium attainment for a single market or individual. Equilibrium study explains many fundamental concept of individual firm i.e. shutdown point, maximum profit, price stabilization etc.

5.    Theory of Demand & Supply

Microeconomics explains vital theory of demand & supply and its role in determination of price. This theory also explains price fluctuation of the goods.