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Microeconomics

Microeconomics is the branch of economics that studies the behavior of individuals and firms in making decisions regarding the allocation of limited resources. It typically applies to markets where goods or services are bought and sold, and examines how these decisions affect the supply and demand for goods and services, which determines prices, and how prices, in turn, determine the quantity supplied and quantity demanded of goods and services.
Sub-categories:

This subcategory explores how consumers make purchasing decisions and how they allocate their budgets among different goods and services.

Producer theory examines how businesses make decisions about production levels, pricing, and resource allocation to maximize profits.

A foundational concept of microeconomics that analyzes how market equilibrium is reached and how prices are influenced by the relationship between the supply of and demand for goods and services.

This area studies different types of market organization, such as perfect competition, monopolistic competition, oligopoly, and monopoly, and their effects on economic outcomes.

Elasticity measures how the quantity demanded or supplied of a good responds to changes in prices, incomes, or other goods. It is crucial for understanding pricing strategies and consumer responsiveness.

Game theory provides frameworks for predicting outcomes in strategic interactions among rational decision-makers, effectively applied in competitive and cooperative environments.

This subcategory deals with the markets for factors of production - labor, capital, and land - and analyses how factor endowments influence cost and pricing.

Welfare economics evaluates economic policies and scenarios in terms of social welfare and how they contribute to overall economic efficiency and equity.

Examines market failures resulting from externalities and explores the unique challenges associated with non-excludable and non-rival public goods.

Asymmetric information studies situations where parties in a transaction have unequal knowledge, leading to market inefficiencies such as adverse selection and moral hazard.

This area focuses on the costs incurred by firms for producing goods and services, including fixed and variable costs and how they affect the firm's optimal output.

Pricing strategies delve into how businesses set prices for their products based on market conditions, cost of production, and consumer behaviour.

Transaction costs involve the expenses related to buying or selling goods and services, which can affect market efficiency and the decision to produce or exchange.

This subcategory examines the role of property rights in determining resource allocation and how incentives influence economic behavior.

Government intervention and policy analyze how regulations, subsidies, taxes, and other governmental actions impact market outcomes and efficiency.

Labor economics investigates the workings of labor markets, wage determination, employment, and the role of human capital in the economy.