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Microeconomics Explained in 8 simple points!

1. Microeconomics has been derived from the Greek Word ‘Mikros

2. It studies individual entities or takes individual approach to study the economic factors

3. It studies each unit in detail for e.g : Individual Demand, Individual Supply, Individual Income, Individual Saving, Individual Output, Individual Investment, Profit & Loss of one particular company.

4. One particular phenomenon is studied from the total thus this is also called as Micro-analysis.

5. Microstudies are done first and are also called slicing methods since they study each unit in detail.

6. Also called as Pricing Theory (concept of supply and demand to determine price of a good/service)

7. It deals with Factor Pricing (Prices of raw materials/factors of production) and Product Pricing (Prices of final goods or finished product)

8. The main aim of microeconomics is to maximize profit and to decrease the cost of production and thus to eventually increase the demand for goods.

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