Micro Economics

  • Micro economics is the study of small part of component of the whole economy.

  • Micro economics is called the price theory. It’s explained its composition, or allocation of total production why more of something is produced than of others.

  • In Micro study about individual consumer behavior or individuals firm or what happens in any particular industry.

  • If it be an analysis of price, we study about the price of a particular producer or of a particular factor of production.

  • If it is demand we analysis demand of an individual or that of an industry.

  • Here we study the income of an individual.

  • It is both positive and normative science. It not only tells us how the economy operates but also how it should be operated to promote general welfare.

  • It can not give an idea of the functioning of the economy as a whole example. An individual industry may be flourishing whereas, the economy as a whole may be languishing.

  • It assumes full employment, which is rare phenomenon, at any state in the capitalist world. It is therefore, an unrealistic assumption.

  • Study of individual aspects of economy will lead us now here.