explain the component of micro economic theory
OR
explain the ' theory of producer behaviour' or 'theory of price' or 'Theory of demand'
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Microeconomic theory typically begins with the study of a single rational and utility maximizing individual. To economists, rationality means an individual possesses stable preferences that are both complete and transitive. ... The utility maximization problem is the heart of consumer theory.
The theory of price is an economic theory that states that the price for any specific good or service is based on the relationship between its supply and demand. The optimal market price, or equilibrium, is the point at which the total number of items available can be reasonably consumed by potential customers.
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