what is microeconomics? example of it? and more info? thank you!?

Answer 1

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The mystery of micro economics can be best explained with an example:


Rebecca, age eleven, received her pocket money of $20. She was excited; she knew exactly what she was going to buy. She wanted to buy a chocolate bar, some balloons for her younger brother, a ribbon for her hair and she wanted to donate $5 to the Wildlife Fund. Whatever money remained, was going into her piggy bank at home.

She eagerly entered the supermarket and found a chocolate bar, which cost $1 and a beautiful bright red ribbon, which also cost $1.


To her horror, the supermarket did not sell single balloons; they only sold packs of 100 balloons, costing $15 per pack! She had promised her brother a balloon and he was but 4 years old - he would not understand if she broke her promise. The next shop was too far away and her father had said that he was unable to take her to another shop until the following week.


She has to decide what to do:

Buy the balloons at $15 to keep a promise to her brother and either not donate the $5 to charity this week, or to put the chocolate bar and ribbon aside; not to buy the balloon until she was able to buy a single one, thereby keeping her other commitments and still be able to enjoy her chocolate and ribbon. There are several other choices that she can make, but ultimately she must decide what she will buy and what she will have to give up.


This is part of the study of Micro Economics: how consumers, including eleven year olds, achieve their goals, and what they must give up in order to purchase a specific product.


Rebecca in her wisdom, decides to bargain with the manager of the supermarket. She asks him to consider opening the packet of 100 balloons and to sell her just one balloon. This is the other part of Micro Economics - the producer, now has to decide whether it will be worth his while to open the packet of balloons and sell Rebbeca the one and then sell the other 99 balloons separately. He has to make calculations and decide if there is a bigger demand for 99 balloons sold separately, or if it would be better to sell by the packet.


Micro Economics is applied to all individuals in all spheres of business - from the consumer, the one who buys and uses the end products, to the producer, the one who makes the product. The producer, and the entrepreneur must decide whether there is a viable market for his proposed product and how much he must ultimately produce to satisfy the demand, and how much it will cost.


The buyer, or consumer, will decide which product to buy and which to forgo.

Answer 2

Microeconomics is the study of how individuals and firms make decisions within the economy. For example how supply and demand change if the government imposes taxes on cartons of cigarettes. This would effect the price, profits, supplies, and demands for cigarettes. Macroeconomics is the study of economy-wide matters such as economic growth.

Answer 3

Microeconomics is a branch of economics that studies how individuals, households, and firms make decisions to allocate limited resources, typically in markets where goods or services are being bought and sold.

Full info: http://en.wikipedia.org/wiki/Microeconomics