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Economics For Managers


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Chapter 1 : Introduction To Microeconomics

Nature And Scope Of Economics
Difference Between Micro & Macro Economics

Relevance Of Microeconomics

Importance of Microeconomic Analysis
Limitations of Microeconomics

Scarcity And Choice

Market Economy
Command Economy
Mixed Economy
Production Possibilities and Opportunity Costs

Production Possibility Curve

Partial Equilibrium And General Equilibrium Analysis

Partial Equilibrium Analysis
General Equilibrium Analysis (GEA)

Economics And Business

Chapter Summary

Unlimited human wants and scarce resources force people to make choices between various goods and services. Economics tries to provide solutions to the problem of scarcity and choice. The field of economics is divided into two areas; microeconomics and macroeconomics. In this chapter we discussed the importance of microeconomics.

We examined how it provides answers to questions like what to produce, how to produce, and for whom to produce. We have discussed the difference between microeconomics and macroeconomics. We also studied the various kinds of economies: market economy, command economy and mixed economy. As individuals have to choose between alternatives, opportunity cost plays a significant role in the decision making process.

With the help of the production possibility curve, the economy can look at ways to utilize its limited resources. Partial equilibrium analysis (PEA) and general equilibrium analysis (GEA) are two different approaches for analyzing the functioning of an economy with inter-related markets.

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