Give reasons or explain the following statements. 1) Micro Economics is also known as price theory.

Give reasons or explain the following statements.

1) Micro Economics is also known as price theory.

ANSWER:

We know that in microeconomics we study the behaviour of individual economic units such as the consumer and the producer. The basic aim of such a study is to determine the prices (in the commodities and factor markets). It is for this reason that microeconomics is also known as the price theory.

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