I. The term Micro Economics is derived from the Greek work “Mikros” which means “Small”. Micro economics gives a detailed analysis of one part of the economy or society. It studies the behaviour of individual units of the economy, such as households, firms, industries and markets.ii. Micro economics is concerned with the study of behaviour of individual element(s) of an economy, whereas, macro economies concerned with the study of behaviours of an economy as whole.iii. Micro-economics gives a microscopic picture of the economy. The activities of numerous economic units and their inter-relationship are studied and analysed minutely through this method.

Microeconomics is a branch of economics that deals with the behaviour of individual economic units such as consumers, firms, and industries. It focuses on the decision-making process of these units and how they allocate their resources in order to maximize their satisfaction or profit. Here are some key points that explain why microeconomics studies the behaviour of individual economic units:

1. Allocation of resources: Microeconomics examines how individual economic units allocate their scarce resources such as time, money, and labour to produce goods and services. It also examines how they make decisions about what to produce, how much to produce, and how to produce it.

2. Price determination: Microeconomics studies how prices are determined in individual markets, based on the interaction between buyers and sellers. It examines how changes in supply and demand affect prices, as well as how different market structures (such as perfect competition, monopoly, and oligopoly) affect price and output levels.

3. Consumer behaviour: Microeconomics analyses how consumers make decisions about what to buy, how much to buy, and how much to pay for goods and services. It examines how factors such as income, prices, and preferences influence consumer behaviour.

4. Firm behaviour: Microeconomics also studies how firms make decisions about production, pricing, and investment. It examines how firms maximize their profits by choosing the optimal level of output and pricing strategy, and how they respond to changes in market conditions.

In conclusion, microeconomics studies the behaviour of individual economic units because it is concerned with how these units make decisions about resource allocation, price determination, consumer behaviour, and firm behaviour. By understanding the behaviour of individual economic units, microeconomics provides insights into how markets work and how economic welfare can be maximized.

Individual economic unit for better understanding of this we can learn it for its name itself that is micro which means small units or individual units...