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    Amity Law School Ii Semester: Micro Economic Theory and Management

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    Emmanual Reddy
    This document provides an overview of microeconomics. It defines microeconomics as the study of individual economic units like consumers, firms, and industries. The document outlines the importance of microeconomics in efficient resource allocation, price determination, and decision making. It also notes limitations of microeconomics in relying on unrealistic assumptions and not providing a full picture of the economy. Key differences between microeconomics and macroeconomics are discussed, such as micro focusing on utility/profit maximization and using price mechanisms, while macro focuses on outcomes for the entire economy.

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    Amity Law School Ii Semester: Micro Economic Theory and Management

    Uploaded by

    Emmanual Reddy
    25 views12 pages
    This document provides an overview of microeconomics. It defines microeconomics as the study of individual economic units like consumers, firms, and industries. The document outlines the importance of microeconomics in efficient resource allocation, price determination, and decision making. It also notes limitations of microeconomics in relying on unrealistic assumptions and not providing a full picture of the economy. Key differences between microeconomics and macroeconomics are discussed, such as micro focusing on utility/profit maximization and using price mechanisms, while macro focuses on outcomes for the entire economy.

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    Amethi Law

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    This document provides an overview of microeconomics. It defines microeconomics as the study of individual economic units like consumers, firms, and industries. The document outlines the importance of microeconomics in efficient resource allocation, price determination, and decision making. It also notes limitations of microeconomics in relying on unrealistic assumptions and not providing a full picture of the economy. Key differences between microeconomics and macroeconomics are discussed, such as micro focusing on utility/profit maximization and using price mechanisms, while macro focuses on outcomes for the entire economy.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    25 views12 pages

    Amity Law School Ii Semester: Micro Economic Theory and Management

    Uploaded by

    Emmanual Reddy
    This document provides an overview of microeconomics. It defines microeconomics as the study of individual economic units like consumers, firms, and industries. The document outlines the importance of microeconomics in efficient resource allocation, price determination, and decision making. It also notes limitations of microeconomics in relying on unrealistic assumptions and not providing a full picture of the economy. Key differences between microeconomics and macroeconomics are discussed, such as micro focusing on utility/profit maximization and using price mechanisms, while macro focuses on outcomes for the entire economy.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
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    AMITY LAW SCHOOL

    B.Com LLB
    II SEMESTER

    MICRO ECONOMIC THEORY


    AND MANAGEMENT

    Ms.CHETNA NEGI
    MICRO ECONOMIC THEORY AND
    MANAGEMENT

    Module I: Nature and Scope of Economics


    Introduction
     In the recent years, the subject-
    matter of economics has been divided
    into two branches: Micro and Macro
    economics. These terms were
    introduced by Prof.Ragnar Frisch of
    Oslo university in 1933.
    Meaning and Definition of Micro
    Economics.
     The term ‘micro' has been derived from
    the Greek word ‘Mikros’. Which means
    small. Thus, micro economics is the
    study of individual units of economy such
    as individual consumers, individual firms
    and small groups of individual units such
    as various industries.
     Thus according to K.E.Boulding, “Micro
    economics is the study of particular
    firms, particular households, individual
    prices, wages, incomes, individual
    industries, particular commodities”.
    IMPORTANCE OF
    MICROECONOMICS

    It is an important method of
    economic analysis which
    Prof.Keynes regards as “a
    necessary part of one’s
    apparatus of thought.”
    1. Helpful in the efficient
    employment of resources.
    2. Helpful in Price Determination
    3. Helpful in understanding the
    whole economy.
    4. Helpful in the formulation of
    economic policies of
    government.
    5. Helpful in decision making of an
    individual.
    Limitation of Micro Economics
     Based on impractical assumptions-
    Micro economics is based on certain
    assumptions like full employment &
    perfect competition etc. These
    assumptions do not hold true in real
    life.
     It does not provide real picture of
    the whole economy-
     Results of Micro analysis do not
    apply on the whole economy-
    DIFFERENCE BETWEEN
    MICROECONOMICS AND MACRO
    ECONOMICS

    1.The objectives of micro economics


    on demand side is to maximise
    utility and on supply side is to
    maximise profits. Whereas, the main
    objective of macroeconomics are full
    employment, price stability,
    economic growth .
    2.The basis of microeconomics is the
    price mechanism which operates
    with the help of demand and supply
    forces. whereas the basis of
    macroeconomics is national income,
    output and employment which are
    determined by aggregate demand
    and aggregate supply.
    3.Micro economics is based on
    the assumption of rational
    behavior of individuals. Whereas
    macroeconomics bases its
    assumptions on such variables as
    the aggregate vol. of the output
    of an economy,etc.
    4.Micro economics is based on
    the partial equilibrium
    whereas macro economics is
    based on general equilibrium.
    5.Micro economics is suitable to study
    the problems of individual economic
    units. Whereas macro economics is
    suitable for the problems of economy
    as a whole.

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