Contact Us
Sign In / Sign Up for FREE
Go to advanced search...

The Principles and Motivating Force of Microeconomics - Term Paper Example

Comments (0) Cite this document
The paper focuses on microeconomics, a branch of economics that deals with the behavior of individual firms and households towards decision making about the allocation of limited resources. It examines how the market behavior and decision can affect the supply and demand of any goods…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER91% of users find it useful
The Principles and Motivating Force of Microeconomics
Read TextPreview

Extract of sample "The Principles and Motivating Force of Microeconomics"

Download file to see previous pages Microeconomics analyzes factors affect prices and how these prices affect the number of goods or services supplied to or from a given market. Moreover, Microeconomics also examines factors affecting the demand for certain goods and services within a particular market domain.

On the other hand, macroeconomics often engulfs the sum total of all the economic activities related to economic growth, unemployment, and inflation. Notably, microeconomics often deals with economic policies that usually influence or affect a nation. Therefore, microeconomics is the aforementioned phenomenon of the economy. Some of the areas of the economy affected by microeconomics include the taxation levels of a particular country. For instance, the emergence of Lucas's analyzes leads to the introduction of the modern macroeconomic theory that is defined upon the basic assumptions of micro-level behavior.

Among the main aims or objectives of the microeconomics is to analyze the market mechanisms that define relative prices of goods and services as well as determining the allocation of limited resources within the many alternative and competitive users and uses. Additionally, the microeconomics often analyzes the market failure especially when the market has failed to produce desirable and efficient results. In such a situation, the market analyzes deploy the use of the microeconomic phenomena to describe the theoretical conditions that are needed for perfect competitions. The most desirable areas of study in the microeconomics include the market symmetric information, general equilibrium, uncertainty principles, and applications of the economic game theory. Furthermore, microeconomics helps in analyzing product elasticity within a market system.

The supply and demand theory often assumes a market is ever perfectly competitive. This means that there are numerous sellers and buyers within a market domain but none of them has the capacity to essentially influence the prices of services or goods within that market domain. ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
(The Principles and Motivating Force of Microeconomics Term Paper, n.d.)
The Principles and Motivating Force of Microeconomics Term Paper. Retrieved from
(The Principles and Motivating Force of Microeconomics Term Paper)
The Principles and Motivating Force of Microeconomics Term Paper.
“The Principles and Motivating Force of Microeconomics Term Paper”, n.d.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF The Principles and Motivating Force of Microeconomics

Principles of Microeconomics

This will create imbalance in the economy hence may result in a shortage of consumer goods. Question 2: opportunity cost means the best substitute given up in order to produce more of other type of goods. As more of one good is produced the opportunity cost to produce it rises (Sloman). Each time we make a choice to do something; simultaneously we are eliminating the choice of an alternative good. Moreover, if a country is producing more of one good it has to sacrifice ever increasing amount of the other. The reason for it is difference in factor of production. Production factors may suit production of a particular type of good and shifting resources to production of other type of good would result in increasing opportunity cost....
5 Pages(1250 words)Essay

Principles of Microeconomics

...?Principles of Microeconomics Economics is the study of how to allocate scarce (God-given) resources to satisfy unlimited human wants. What are the limits or constraints that make this objective so hard to achieve? How should Christians behave given such limitations? Resources are very significant from the human perspective. This is because economically speaking, the resources make it possible for man to achieve his goals and make available the benefits that have come about. The Christians should behave much like other people who are from varied religions. The limitations need to be worked upon so that sanity could prevail within the related domains. The limits and constraints that make it so hard to achieve include the fact that man has...
5 Pages(1250 words)Essay

Principles of Microeconomics

...? Principles of Microeconomics Word Count: 3000 d: July 24, Q1. Larry, Moe and Curly decided to start a business selling used cars together.Discuss the advantages and disadvantages of operating the business as a partnership and a corporation. Ans: When deciding to operate as a partnership Moe, Curly and Larry will have several advantages as well as disadvantages. Partnerships are comparatively easy and convenient to develop. Moreover, this type of organization increases the ability to raise larger sums of capital. Additionally, the profits generated by the business are directly earned by the partners after deduction of taxes. Various distinctive skills brought by the partners can be availed which assist in advancing the progressions...
12 Pages(3000 words)Essay

Principles of Microeconomics

...? Running Head: PRINCIPLES OF MICROECONOMICS Topic: Principles of Microeconomics Transition from monopolistic to monopoly market structure Generally, there is a wide spread believe that relative efficiency in resource allocation increases monopolistically as the number of firms continue expanding” or “if competition increases, then welfare will increase” (Mckenzie 2008). This is dependents on the nature of the market that exists in a particular economy. In order to effectively discus the economic transition as argued in the question, it is better to understand exactly what a monopoly market is. This is a market structure where there is only one seller/producer for a particular product i.e. a single buyer in the entire business setting...
5 Pages(1250 words)Research Paper

Microeconomics Principles

... Business Microeconomics Principles Introduction This paper will focus on establishing a discussion that can foster substantial understanding of significant ideas concerning gains from trade, opportunity cost and price elasticity of demand; In fact, this discussion is made in the context of consumer behaviors. Moreover, this paper will present real events in order to present the ideas in a way that is easy to understand. Gains from trade In a decision to get a haircut, Gains from trade can be understood through determination of the decision made by a consumer depending on the other services available. Therefore, a decision to have a haircut can result to consumers having their lives than they would if there was no trade. In this case...
3 Pages(750 words)Essay

Principles of Microeconomics

...Principles of Microeconomics Answer to Utility is a concept which "represents the advantage or fulfillment a person receives from consuming a good or service" which then "explains how individuals and economies aim to gain optimal satisfaction in dealing with scarcity" (Investopedia ULC). Utility is an arbitrary concept representing a relative value (Investopedia ULC). The general observation is that the higher the amount of one good or service consumed, the higher the utility and this incremental utility achieved from the consumption of additional good is called the marginal utility (Investopedia ULC). However, it is observed that the marginal utility tends to diminish as you consume more of the goods (Investopedia ULC). There are two...
3 Pages(750 words)Essay

Microeconomics: Principles and Policy

The four major market structures often discussed by economists are perfect competition, which is production by numerous firms with identical/homogeneous products as well as the presence of conditions of free entry and exit; monopoly, which is produced by a single firm; monopolistic competition, which is production by many firms with somewhat different or differentiated products; an oligopoly, which is production by several firms.
Perfect competition is the ideal market condition envisioned by the great economist Adam Smith and is often studied first because it is the easiest to understand and it can serve as the starting point as well as a gauge by which to measure the performance of the other market structures. The demand cur...
7 Pages(1750 words)Assignment

Principles of MicroEconomics

... Microeconomic Principles Demand can be defined as the correspondence between the quantity of that good or service demanded by consumers (the dependent variable) and a host of relevant explanatory variables. 1. Demand for batter depends on the price of butter itself, price of its substitutes, price of complimentary goods and income. Therefore demand function for butter can be portrayed in notation form as: D=f (Pb, Ps, Pc, 1+/-) Where; D=demand for butter f=a functional relationship with arguments used in parenthesis Pb=price of butter Ps=price of substitutes Pc=price of complimentary goods I= disposable income +/-notes whether there is recession (+) or not (-) a) Increase in price of margarine P p1 p0 D1 D0 0 Q0 Q1...
2 Pages(500 words)Speech or Presentation

Principles of Microeconomics

... units. Since this output is socially efficient, there is no deadweight loss created by this monopoly. Q21) Price fixing is when two or more firms from the same industry collude and agree to fix the prices they charge for the products they produce. The primary motive behind price fixation is to earn higher profits by charging a premium price from the customers and reduce competition that persists between the firms. Due to lack of competition, firms may collude and charge a very high price from the consumers. Price fixation and cartel formation is illegal according to the U.S law. For example, there are three firms in an industry and they collude to form a cartel. They fix the prices they will charge from their customers and all the three...
5 Pages(1250 words)Essay

Principles of Microeconomics

... Externalities Externalities are quite common today especially with the technological advancements that are experienced in almost all the sectors in the economy. Externalities are the incidental effects that a party gets due to another party’s actions (Mankiw, 55).This essay discusses a negative externality that a society gets due to the existence of a manufacturing firm in its neighborhood. Despite the manufacturing company bringing benefits to the society such as construction of roads and providing employment to locals, it has a negative impact to the society. One of the effects the company has on the society is the emission of its chemical waste into the society’s river. The river which the company emits chemical waste has... Externalities ...
1 Pages(250 words)Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Term Paper on topic The Principles and Motivating Force of Microeconomics for FREE!

Contact Us