Microeconomics - clause. It implies that the analysis...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Microeconomics Microeconomics is a static approach in the sense it concentrates on individual behavior in a very short period of time. It analyzes instant changes in behavior. It avoids taking account of long term and external effects on such behavior. Since economic life is highly complex and interdependent, such a simple approach requires the help of strong assumptions. These assumptions are together stated in the form of the ceteris paribus
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: clause. It implies that the analysis operates under the condition "other things are equal or constant or remain unchanged " when individual behavior alters. Other things include income of the individual, number of members of a family, price of substitutes, taste of a consumer, technical conditions of production, supply of labor, land, capital and other resources, fiscal and monetary policies of the government, etc....
View Full Document

This note was uploaded on 11/26/2011 for the course ECONOMIC ec 201 taught by Professor - during the Fall '10 term at Montgomery.

Ask a homework question - tutors are online