definition of micro economics
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Definition
Microeconomics is a branch of economics that studies the behavior of individuals and firms in making decisions regarding the allocation of scarce resources and the interactions among these individuals and firms.
Explanation:
Microeconomics is a social science; it is the study of individual, isolated units of an economy – those individual pieces, when put together, make up the whole economy. Each person, household, company or industry is a unit of the economy. It is the part of economics that is concerned with single factors and the effects of individual decisions.
Microeconomics is mainly focused on the factors that influence individual economic choices, the effect of changes that occur in these factors on each decision-maker, and how demand and prices are determined in individual markets.
Microeconomics contrasts with macroeconomics, which is the study of phenomena that span the whole economy, such as unemployment, GDP (gross domestic product) growth or decline, and inflation.
Economics is a social science that covers a vast field, which can be broken down into scores of different divisions. Its two principal branches are microeconomics and macroeconomics.