Introduction to Microeconomics

Microeconomics is

• the aggregate or total level of income, employment and output

• not concerned with details, but with the overall 'big picture' of the economy

• concerned with individual economics units and specific market

• the establishing of an overall view of the operation of an economic system

World economic problem

• What, when and for whom to produce

• Why, What, and how to produce

• When, How and for whom to produce

• What, how and for whom to produce

The economic problem of scarcity refers to

• limited wants and limited resources

• unlimited wants and unlimited resources

• unlimited wants and limited resources

• limited wants and unlimited resources

Prohibition of interest (riba) applied in this economic system

• Capitalism

• Socialism

• Mixed Economy

• Islamic Economy

When an economy is operating with maximum efficiency, the increased production of commodity A will entail the decreased production of commodity B because

• material wants are insatiable

• resources are limited and choices should be made.

• the structure of demand is fixed at any point in time

• resources are specialised and cannot be changed

The central authority is responsible for making economic decision for society in this World Economic System

• Socialism

• Islamic Economy

• Mixed Economy

• Capitalism

Price mechanism is a system used to make economic decision in this world economic system

Both private and public sectors play important roles in this world economic system

• Capitalism

• Socialism

• Mixed Economy