MICROECONOMIC

S
A brief analysis
 TABLE OF
CONTENTS
INTRODUCTION PRODUCTION ELEMENTS OF
01 04 MICROECONOMICS
-What is microeconomics?
-Terms related to microeconomics -Land -Capital
-Labour -
BRANCHES OF Entrepreneurship
WHY SHOULDWE STUDY
ECONOMICS
MICROECONOMICS?
02 -Macro & Micro economy 05 -Resource allocation
---------Ideological differences -Informed decision making
-Global interconnection
CIRCULAR FLOW
-Policy Impact
OF MICROECONOMICS
03 -Household
06 CONCLUSION
-Firms -Concluding statement.
-Thank you.
INTRODUCTION
WHAT IS
MICRO
ECONOMICS?
Microeconomics is the branch of economics
that focuses on the study of individual
economic units, such as households, firms,
and markets. It examines the behaviour and
decision-making of these smaller units,
exploring how they allocate their resources
and interact within specific markets.
 TERMS
RELATED TO
MICROECONOMI
CS
ECONOMY:
Economy is the study of Need, Want & Demand

NEED: Feeling of deprivation

WANT: When the need becomes specific

DEMAND: Willingness to pay

MICROECONOMIC:
The part of economy that is concerned
with single factor & the effects of
individual decision.
BRANCHES OF ECONOMICS
 BRANCHES OF
ECONOMICS
There are mainly 2 branches of economy.
They are-

MACROECONOMY:
Macroeconomics focuses on the changes
in inflation, interest and foreign
exchange rates.

MICROECONOMY:
The part of economy that is concerned
with single factor & the effects of
individual decision.
 COMPARISON BETWEEN MACRO & MICRO
ECONOMY
Microeconomy
It is the study of individual
economic units of an economy
It deals with individual income,
prices & outputs etc.
It’s central problem is price
determination & resource allocation
It’s main tools are demand & supply
of particular commodity/factor
Macroeconomy
It is the study of economy as
whole and it’s aggregates
It deals with aggregates like national
income, general price levels
It’s central problem is determination of
income & employment level
It’s main tools are aggregate demand
& supply of the economy as a whole
CIRCULAR FLOW OF
MICROECONOMICS
 CIRCULAR
FLOW OF
MICROECONOMI
CS
There are mainly 4 factors in the circular flow of microeconomy. They are-

(1) HOUSEHOLD: (3) LABOR MARKET:

Households are key economic players, The labour market involves the supply &
engaging in consumption, savings & demand for workforce, affecting wages,
investment, influencing overall demand. employment levels & overall productivity.

(2) FIRMS: (4) PRODUCT MARKET:

Business drive economic production, The product market reflects specific
impacting growth & employment, with opportunities & conditions of
decisions on pricing, production & employment, influenced by industry
innovation shaping market dynamics. trends & government policies.
An Image representing the Circular Flow of Microeconomics
PRODUCTION ELEMENTS OF
MICROECONOMICS
 PRODUCTION ELEMENTS OF
MICROECONOMICS
There are mainly 4 elements in the production of microeconomics. They are-

(1) LAND: (3) CAPITAL:

Natural resources, location & The physical capital includes tools, machinery
geographical features influences & infrastructure. Whereas, the financial capital
production to a great extent. includes, money and investments

(2) LABOR: (4) ENTREPRENEURSHIP:

Human effort & skills applied to The innovative & risk taking
production includes the joint organizations initiate the necessary
combination of physical and intellectual steps to drive economic activities to
capabilities. create value.
WHY SHOULD WE STUDY
MICROECONOMICS?
 WHY SHOULD WE STUDY
MICROECONOMICS?
There are mainly 4 elements in the production of microeconomics. They are-
(1) UNDERSTANDING (3) GLOBAL INTERCONNECTEDNESS:
RESOURCE ALLOCATION: Microeconomics ties the global regions,
Microeconomics helps us to understand markets, trade & finance, enabling us to
the allocation and utilization of navigate & participate effectively in the global
resources like money, time & labour. economy.

(2) INFORMED DECISION (4) POLICY IMPACT:

MAKING: A grasp of microeconomics empowers citizens
Studying microeconomics helps to critically assess & influence government
individuals to form analytical abilities policies to shape an informed economic system
to make informed decisions in personal to address social challenges.
CONCLUSION
 Microeconomics provides a
comprehensive perspective on individual
decisions, market dynamics, resource
efficiency & policy implications

Exploring it’s principals not only enhances

our understanding but also equips us to
prove it’s efficiency beyond academia
 A
PRESENTATION
BY
SANAM NAZ
BBA-65 Batch
th

Faculty of Business Administration,

Bangladesh University