Economics is the science of allocation of limited resources to meet unlimited human wants. Here we are talking about the micro aspect of Economics that deals with individual's decision making.
A routine of person on holiday describe all the principle of Micro-Economics. A person have limited money to spend, so people face trade off i.e. what to buy what not to buy, whether to go for shopping or to go for a movie. Now this confusion leads to another problem of what to sacrifice because one can only go for either shopping or movie. so what is sacrificed here is called opportunity cost. In the movie interval people think at marginal i.e. if he can make additional expenses on popcorn and cold drinks, then lastly look for incentives. He looks for that place where we can get good offer or discount.
Thus the four principle of microeconomics can be summarised from a person visit to movie or a mall.
A routine of person on holiday describe all the principle of Micro-Economics. A person have limited money to spend, so people face trade off i.e. what to buy what not to buy, whether to go for shopping or to go for a movie. Now this confusion leads to another problem of what to sacrifice because one can only go for either shopping or movie. so what is sacrificed here is called opportunity cost. In the movie interval people think at marginal i.e. if he can make additional expenses on popcorn and cold drinks, then lastly look for incentives. He looks for that place where we can get good offer or discount.
Thus the four principle of microeconomics can be summarised from a person visit to movie or a mall.
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