ECONOMICS Lecture Notes - Gross Domestic Product, Monopolistic Competition, Microeconomics
Document Summary
Microeconomics and macroeconomics are two distinct branches of economics that study different aspects of economic activity. Microeconomics focuses on individual economic units, such as households, firms, and industries, while macroeconomics focuses on the economy as a whole, including issues such as inflation, unemployment, and economic growth. Explanations on microeconomics: microeconomics is concerned with understanding the behavior of individual economic actors, such as households, firms, and markets. It examines how these actors make decisions about the allocation of resources, the production and consumption of goods and services, and the pricing of these goods and services. According to this theory, the price and quantity of a good or service in a market are determined by the interaction of supply and demand. If demand for a good or service increases, while supply remains constant, the price of the good or service will increase, leading to an increase in quantity supplied.
