Class 12 Exam > Class 12 Notes > Importance of Micro Economics - Class 12
Importance of Micro Economics - Class 12 PDF Download
explain the importance of micro economics
Ref: https://edurev.in/question/723069/explain-the-importance-of-micro-economics-Related-Chapter-2-Consumer-Equilibrium-Chapter-Notes-Micr
1. Helpful in the Efficient Employment of Resources:
Microeconomics is helpful in the efficient employment of the limited, scarce resources of a country. The principal problem faced by the modern government is the allocation of its scarce resources among the competing ends. It is the burning problem of the day. Microeconomic theory explains the condition of efficiency in both production and consumption, which are vital to economics and highlights the factors which are responsible the departure from efficiency. On this basis microeconomic theory suggests suitable policies which should be adopted by modern governments to promote economic efficiency and thereby achieving all-round growth, prosperity and stability in the economy.
2. Understanding Free Enterprise Economy:
Microeconomics is of great importance in understanding the working of free enterprise economy without any central control. In such an economy there is agency to plan and coordinate the working of the economic system. Such decisions as to how to produce, what to produce, when to produce, and for whom to produce are taken independently by the producers. Similarly, decisions as to what to consume, whom to consume and how much to consume are decisions taken by consumers themselves.
3. Helpful in the Development of International Trade:
Microeconomics is also helpful in the development of international trade. It is used to explain the gains from international trade, balance of payment disequilibrium and the determination of foreign exchange rate.
4. Helpful in Understanding the Implications of Taxation:
Microeconomics is also helpful in understanding the implication of taxation. It helps in explaining as to whether an income tax leads to decrease in the social welfare or an excise duty or sales duty. It is the imposition of an excise duty or sales tax that leads to the decrease in social welfare rather than income tax.
5. Basis for Welfare Economics:
The greatest justification for the study of micro economics is that it provides the basis for welfare economics. The entire structure of welfare economics has been built on price theory which is the constituent part of microeconomics. It shows how the relative prices of various products and factors are formed. A.P. Lerner observed, “Microeconomic theory spells out the condition of efficiency and suggests how it can be achieved. These conditions can be of great help in raising the standard of living of the population.
6. Provides Tools for Evaluating Economic Policies:
Microeconomics provides tools for evaluating economic policies of the state. Microeconomic theory explains the condition of efficiency in consumption and production and highlights the factors which are responsible for the departure from efficiency. On this basis microeconomics suggests suitable economic policies to promote economic efficiency and welfare of the people. A Price policy is also an important tool for economic policies. Microeconomics helps the state in formulating correct price policies and evaluating them in proper perspective.
7. Construction and Use of Models:
Microeconomics constructs and uses simple models for understanding of actual economic phenomena. In this field, the usefulness and the importance of microeconomics is aptly stated by Professor A.P. Lerner, he writes, “microeconomic theory facilitates the understanding of what would be a hopelessly complicated confusion of billions of facts by constructing simplified models of behaviour which are efficiently similar to the actual phenomena depart from certain ideal constructions that would mostly achieve individual and social objectives”. He further writes,” thus they help not only to describe the actual economic situation but to suggest policies that would most successfully and most efficiently bring about desired results and to predict the outcomes of such policies and other events”.
FAQs on Importance of Micro Economics - Class 12
| 1. What is microeconomics? |  |
Microeconomics is a branch of economics that analyzes the behavior of individuals and firms in making decisions regarding the allocation of limited resources. It focuses on the study of individual markets, such as the supply and demand for specific goods and services, and how prices and quantities are determined.
| 2. Why is microeconomics important? | |
Microeconomics is important because it helps us understand how individuals and firms make decisions in a world with limited resources. It provides insights into the functioning of markets, the behavior of consumers and producers, and the factors that influence their choices. This knowledge is essential for policymakers, businesses, and individuals to make informed economic decisions.
| 3. How does microeconomics relate to everyday life? | |
Microeconomics is relevant in our everyday lives as it helps us understand various economic phenomena and make better decisions. For example, it can explain why prices of certain goods increase or decrease, how individuals make choices regarding their spending and savings, and how businesses decide on production levels and pricing strategies. By understanding microeconomics, individuals can make informed choices about their personal finances and businesses can optimize their operations.
| 4. What are the key concepts in microeconomics? | |
Some key concepts in microeconomics include supply and demand, elasticity, consumer behavior, production and costs, market structures (such as perfect competition, monopoly, and oligopoly), and market failures (such as externalities and public goods). These concepts provide a framework for analyzing and understanding how markets function and how individuals and firms interact within them.
| 5. How does microeconomics differ from macroeconomics? | |
Microeconomics and macroeconomics are two branches of economics that focus on different levels of analysis. Microeconomics examines the behavior and decisions of individuals and firms, while macroeconomics looks at the economy as a whole, including factors such as inflation, unemployment, and economic growth. Microeconomics focuses on specific markets and individual economic agents, while macroeconomics deals with aggregate measures and trends.
Related Exams
About this Document
|
4.87/5 Rating |
|
Nov 24, 2024 Last updated |
Document Description: Importance of Micro Economics - Class 12 for Class 12 2024 is part of Class 12 preparation. The notes and questions for Importance of Micro Economics - Class 12 have been prepared according to the Class 12 exam syllabus. Information about Importance of Micro Economics - Class 12 covers topics like and Importance of Micro Economics - Class 12 Example, for Class 12 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises and tests below for Importance of Micro Economics - Class 12.
Introduction of Importance of Micro Economics - Class 12 in English is available as part of
our Class 12 preparation & Importance of Micro Economics - Class 12 in Hindi for Class 12
courses. Download more important topics, notes, lectures and mock test series for Class 12
Exam by signing up for free. Class 12: Importance of Micro Economics - Class 12
Description
Full syllabus notes, lecture & questions for Importance of Micro Economics - Class 12 - Class 12 | Plus excerises question with solution to help you revise complete syllabus | Best notes, free PDF download
Information about Importance of Micro Economics - Class 12
In this doc you can find the meaning of Importance of Micro Economics - Class 12 defined & explained in the simplest way possible.
Besides explaining types of Importance of Micro Economics - Class 12 theory,
EduRev gives you an ample number of questions to practice Importance of Micro Economics - Class 12 tests, examples and also practice Class 12 tests.
Download as PDF
|
Explore Courses for Class 12 exam
|
|
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
Related Searches
Summary
,Importance of Micro Economics - Class 12
,Objective type Questions
,Viva Questions
,Extra Questions
,Previous Year Questions with Solutions
,mock tests for examination
,past year papers
,video lectures
,ppt
,Important questions
,MCQs
,Semester Notes
,Free
,Importance of Micro Economics - Class 12
,practice quizzes
,Exam
,study material
,Sample Paper
,shortcuts and tricks
,Importance of Micro Economics - Class 12
;
Additional Information about Importance of Micro Economics - Class 12 for Class 12 Preparation
Importance of Micro Economics - Class 12 Free PDF Download
The Importance of Micro Economics - Class 12 is an invaluable resource that delves deep into the core of the Class 12 exam.
These study notes are curated by experts and cover all the essential topics and concepts, making your preparation more efficient and effective.
With the help of these notes, you can grasp complex subjects quickly, revise important points easily,
and reinforce your understanding of key concepts. The study notes are presented in a concise and easy-to-understand manner,
allowing you to optimize your learning process. Whether you're looking for best-recommended books, sample papers, study material,
or toppers' notes, this PDF has got you covered. Download the Importance of Micro Economics - Class 12 now and kickstart your journey towards success in the Class 12 exam.
Importance of Micro Economics - Class 12
The importance of Importance of Micro Economics - Class 12 cannot be overstated, especially for Class 12 aspirants.
This document holds the key to success in the Class 12 exam.
It offers a detailed understanding of the concept, providing invaluable insights into the topic.
By knowing the concepts well in advance, students can plan their preparation effectively.
Utilize this indispensable guide for a well-rounded preparation and achieve your desired results.
Importance of Micro Economics - Class 12 Notes
Importance of Micro Economics - Class 12 Notes offer in-depth insights into the specific topic to help you master it with ease.
This comprehensive document covers all aspects related to Importance of Micro Economics - Class 12.
It includes detailed information about the exam syllabus, recommended books, and study materials for a well-rounded preparation.
Practice papers and question papers enable you to assess your progress effectively.
Additionally, the paper analysis provides valuable tips for tackling the exam strategically.
Access to Toppers' notes gives you an edge in understanding complex concepts.
Whether you're a beginner or aiming for advanced proficiency, Importance of Micro Economics - Class 12 Notes on EduRev are your ultimate resource for success.
Importance of Micro Economics - Class 12 Class 12 Questions
The "Importance of Micro Economics - Class 12 Class 12 Questions" guide is a valuable resource for all aspiring students preparing for the
Class 12 exam. It focuses on providing a wide range of practice questions to help students gauge
their understanding of the exam topics. These questions cover the entire syllabus, ensuring comprehensive preparation.
The guide includes previous years' question papers for students to familiarize themselves with the exam's format and difficulty level.
Additionally, it offers subject-specific question banks, allowing students to focus on weak areas and improve their performance.
Study Importance of Micro Economics - Class 12 on the App
Students of Class 12 can study Importance of Micro Economics - Class 12 alongwith tests & analysis from the EduRev app,
which will help them while preparing for their exam. Apart from the Importance of Micro Economics - Class 12,
students can also utilize the EduRev App for other study materials such as previous year question papers, syllabus, important questions, etc.
The EduRev App will make your learning easier as you can access it from anywhere you want.
The content of Importance of Micro Economics - Class 12 is prepared as per the latest Class 12 syllabus.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup