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    Microeconomics

    Microeconomics studies how consumers and suppliers make economic decisions, how these decisions determine the allocation of resources and the impact public policy has on the market. It looks at the behaviour of individual firms and households and how the supply and demand for goods and services are affected by their decisions. Microeconomics also looks at how national economic policies affect the economy. It is importnat to understand how microeconomics works in order to understand macroeconomics. 

    In contrast to macroeconomics, which studies the economy as a whole, microeconomics looks at the interrelationships between elements of the economy, such as consumers, markets, and industries. Microeconomics analyzes the conditions that produce the most efficient level of consumption and production.

    Scarcity is the main drive behind the daily choices individual consumers, producers, and suppliers make. The main goal of consumers, producers, and governments is to find a way to maximize satisfaction with the resources available. Consumer decisions are generally based on budget restraints and personal preferences.

    Opportunity cost is a way to measure the cost of something, in order to determine if the something should be chosen or purchased. This is one concept that is frequently used in microeconomics.

    Microeconomics helps us understand consumer and market behaviour, which is a crucial part of studying economic theory. Understanding microeconomics helps us to maximize resource utilization, build on welfare economics, and provide methods for assessing economic policies.

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    BrainMass Categories within Microeconomics

    Demand & Supply

    Solutions: 838

    Demand and supply in microeconomics is related to having enough products to sell in order to meet consumer demand.

    Efficiency & Equity

    Solutions: 15

    Efficiency and equity are conditions of a mixed economy that are seen as microeconomic goals.

    Utility & Demand

    Solutions: 70

    The relationship between utility and demand falls under the theory of consumer behaviour.

    Preferences & Choice

    Solutions: 37

    In economics, preference refers to the assumptions of a product’s alternatives, relating to the degree of satisfaction or utility that the product gives the consumer.

    Output & Costs

    Solutions: 953

    When looking at output and costs, the positive slope of the aggregate supply curve shows us how costs and prices are related to output.

    Production

    Solutions: 355

    Production is the act of creating output that is used and valued by consumers.

    Uncertainty

    Solutions: 47

    Uncertainty is related to the accuracy of the economic model that tries to determine levels of growth and is tied to most fields in economics.

    BrainMass Solutions Available for Instant Download

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    Production, Unemployment and Inflation

    1. Suppose that in 2013, the economy produced 10 shirts at $20 each and 5 hamburgers at $5 each. In 2014, the economy produced 15 shirts at $21 each and 10 hamburgers at $6 each. 2. What is the value of real GDP produced in 2014 using 2013 as the base year? 3. What would be the growth in real GDP? 4. Why is there unemployme

    Basic Concepts in Elasticity

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    Monopoly in the Gas Market in Newland County

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    Marginal Utility and Optimal Consumption

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    Economics: Price Elasticity Questions

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    Effects of change in economic market

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    Stackelberg Equilibrium & SPNE

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    Hiring and Productivity

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    Game theory and fast food restaurants

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    Decisions for Profit Maximization

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    Higher Markup

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    Reducing total cost

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    Price Discrimination Strategy for trendy bar and electronics store.

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    Hiring a New Waiter

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    Advanced Pricing Techniques

    The Wall Street Journal is purchased both by general readers, but it also offers student pricing through universities. Weekly demand from general readers is given by DG = 1.2 - 0.01Q, and from students is DS = 0.8 - 0.01Q. Q is in thousands of newspapers. The cost of production doesn't differ between types of readers, and is giv

    Net Present Value: Two-Period Project

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    Effect of Currency Appreciation on Imports and Exports

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