A Brief Introduction to Microeconomics

Microeconomics is the study of the economic effects of the actions of individuals. Microeconomists look for patterns in how choices are made in response to a variety of microeconomic factors, such as changes in prices, incentives, resources and production methods. This data allows companies to allocate resources according to the most likely behaviours of the consumer.

1. A BRIEF INTRODUCTION TO
MICROECONOMICS
Domen Zavrl

2. DOMEN ZAVRL
DOMEN ZAVRL
2
Microeconomics is the study of the economic effects
of the actions of individuals. Microeconomists look
for patterns in how choices are made in response to a
variety of microeconomic factors, such as changes in
prices, incentives, resources and production methods.
A BRIEF INTRODUCTION
TO MICROECONOMICS

3. DOMEN ZAVRL
3
There are
various concepts
which underpin
the study of
microeconomics.
These include
behaviours and
incentives, or the
ways in which
individuals react
to situations.
T
his data allows companies to allocate
resources according to the most likely
behaviours of the consumer.
MICROECONOMIC CONCEPTS
There are various concepts which underpin
the study of microeconomics. These include
behaviours and incentives, or the ways in
which individuals react to situations.
Microeconomics also examines what is known
as utility theory, which is the combinations of
goods people will buy (within their personal
income limitations) to maximise their own
happiness.
Production theory looks at the ways in which
producers of goods can maximise profits by
minimising cost – or how to best arrange their
inputs and methods to generate more profit.
Price theory, also known as supply and
demand, looks at how utility theory and
production theory interact with each other.
This helps determine the price of goods or
services in a competitive market.

4. DOMEN ZAVRL
The flip side to microeconomics
is macroeconomics. You can learn
more about this by visiting the blog
of Domen Zavrl.