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Microeconomics involves the study of individuals and firms and their behavior in decision-making. The branch focuses on the effects of policies like tax change etc on the economy. The study expands its range to the analysis of market mechanisms and market failures. It also helps to plan conditions to compete in the market. The branch of economics includes demand, supply, equilibrium, consumer demand, production, the cost of production, monopoly, oligopoly, market structure, game theory, etc.
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Microeconomics plays a very significant role in the learning of contemporary economic theory. It is consequently significant in the following ways:
- To recognize the working of an economy;
- For good provision and utilization of scarce accessible resources;
- Helps in cost discovery of a fussy product;
- For global trade;
- Helps in formulating different economic policies & economic plans to endorse all-round economic growth;
- Learning the social requirements under the different market environments like monopoly, oligopoly, etc.
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