What is involved in the study of microeconomics?

Microeconomics study includes the study of basic economic principles that apply to individuals and companies. This is in direct contrast to macroeconomic principles that relate and affect the economy as a whole. Some of the factors included in the microeconomics study are the principles of demand and supply and their connection with individuals and companies, the principle of opportunities for the opportunity, consumer selection and the effects of government policies.

One of the factors in the microeconomics study is the principle of demand and supply. Normally, the buyer and the seller have the market, which creates perfect competition and will not cause any significant increase or reduction of products and services. Economic students learn that this is not always the case, because some categories of buyers or sellers often have the ability to manipulate goods on their own goal. For example, the price of diamonds is determined by several key players in the Tprůvysl, which owns large shares in some of the largest diamond mines in the world. MaThey nip the price of diamonds by maintaining strict control over the amount of diamonds on the market at a given time. The purpose of limiting the number of diamonds on the market is to create the illusion of deficiency and rare, allowing them to use and set high prices for diamonds.

Part of the microeconomics study is the theory of opportunity costs, which is the cost of something he has given up to gain another best advantage. The cost of the opportunity is simply a way to assign a value to something. For example, a man can go to a grocery store to buy a carton of eggs that cost $ 2 (USD), but instead decides to buy a bottle of orange juice that costs $ 4 (USD). The cost of buying a bottle of orange juice is two cartons of eggs.

The influence of government policies includes factors such as the influence of quotas, taxes and subsidies on consumer and companies' behavior. Taxes can affect the way consumers spendThey crawl goods, such as how high taxes are imposed on cigarettes to discourage people from smoking. The efficiency of such high taxes can be determined by assessing the demand for the product before and after storage of high taxes. Import quotas can affect the amount of commodity that can be imported into the ground, leading to a situation where the amount of the affected commodity is controlled. Such a situation could create an artificial lack of good, which would increase the price of the products.