Scope of micro economics.

As a branch of economics theory,micro-economics covers the following aspects :

1. allocation of resScope of micro economics.Scope of micro economics.ources :Micro-economics studies the allocation of resources.It assumes full employment of resources.It assumes the total quantity of resources as given being (fixed)and explains how the resources are allocated among production of different goods.It determines what to produce,how to produce.Theory of product pricing :The allocation of resources in production of different goods depends on the prices of goods.It determines what to produced,how to produced.
2. Theory of product pricing :The allocation of resources in production of different goods depends on the prices of goods.The prices of a good is determines by demand for and supply. The demand for a good depends the tastes of the consumer,prices of substitutes,availability of substitutes execution of consumer etc.On the other hand,the supply of a good depends on the behavior of the entrepreneur and the cost condition.Therefor,the theories of demand and product are also studies under product pricing.
3. Theory of factor pricing :The determination of the prices of factors of production is also studied under micro-economics,which is termed as "theory of Distribution".It studies the determines of prices of different factors like land,labour ,capital and organisation .In other words,it studies how rent,wages,interest and profit are determined.
4. Theory of economics welfare :The theory of economic welfare is an important component of micro-economics theory.The theory of economic welfare studies about the economic efficiency.The economic efficiency here refers to the allocation of resources so as to maximise people's welfare.The efficiency in production,distribution,and constipation are needed for overall economic efficiency.The field covered by micro-economic can be shown as blow.