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We have a clear classification of the term economics. Microeconomics is the first branch and macroeconomics is the second component. Both of these branches have their own importance. If you need an A+ in your coursework, you have to workout both macro and micro.
We are well versed about the importance of economics as a whole; however microeconomics plays a vital role in it. For a naive person, it is immaterial that how the price of the commodities is changing or how demands and supply principle works, however, it means a lot to the people who are directly impacted by this volatility. Microeconomics throws light as to how the goods and services produced are distributed among the various people for consumption through market mechanism.
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Wikipedia define Microeconomics as an area dealing with the individual household behaviour and behaviour of the firms in decisions making on the resource allocation. The main areas where we can find the application of microeconomics are the markets where goods or services exchange takes place. It helps in examining the effect of decisions and behaviours on the supply and demand for goods and services. As a result, we can determine prices and how prices help in the determination of the supplied quantity and quantity demanded of goods and services.
One of the primary goals of Microeconomics is market mechanisms analysis. This market analysis facilitates in establishing relative pricing amongst goods and services. It also helps in the judicial allocation of limited resources amongst multiple alternative uses. It analyses the reason for the market failure when markets fail to show optimized and efficient results. It provides the theoretical conditions needed for perfect competition.
Microeconomics is a broad area, and it is not possible for us to highlight every concept related to this particular field, however few of the important topics that you should understand are:
Game Theory : This is one of the most important areas used by managers in decisions making. Managers use Game theory models in making better decisions regarding price and output. As managers work in interactive payoff environments, they need a framework that anticipates the actions of others.
There are a couple of game theory, techniques that are used by many organizations are: Two Person Games: In this game the player can be a single player or can also be an organization- is a decision-making unit with a certain amount of resources. The rules of the game describe how these resources can be utilized. Another technique is Nash equilibrium.
Applied microeconomics includes many specialized study areas, many of which draw on methods from other fields. It is the field applicable in industrial organization.
Assignments on Labour economics examines employment, wages and dynamics of the labour market. Another niche area of financial economics considers topics such as the rate of return to capital, optimal portfolio structure, security, returns using econometric analysis, and the behaviour of corporate financial. There is a need to examine the government tax and expenditure policy design. Public Economics provides a platform for the same. Economics touches almost every facet of the country and politics is not an exception. The political economics homework determines the role that political institutions in determining policy outcomes.
Heath care system of the economy is examined with the help of Health economics assignments. This branch covers the role of the health care workforce and health insurance programs. We have a special branch for the urban area. Urban economics examines the challenges faced by cities, such as air and water pollution, poverty, traffic congestion and covers urban geography and sociology. Law and economics apply microeconomic principles to the selection and enforcement of competing legal regimes and their relative efficiencies.
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