Micro economics is a branch of economics that studies the economic activities of individual (units) or small parts of the economic problems or disagregat. Such as life / activities of a firm, level of prices and wages, allocation of production factors, and so on.So studying microeconomics more specifically against the units of economic activity and what happens to an economy that lasts. Microeconomic theory approach using abstract models in seeing how the price formation of an object and how available resources are allocated to the various kinds of production for public use.

Function of microeconomic theory is merely explains and can be used as a basis for forecasting, where we are forecasting is possible to membut a conditional or predictions besyarat, where the condition is the existence of an ASSUMPTION.

One of the most perfect models in microeconomic theory is a model of supply and demand model, where through the use of this model the conditional forecasts can be made. For example, it can be said that if the curve is negatively sloped demand and supply curve is positively sloped, then the price rises above the equilibrium price would create a surplus of goods in the market, and vice versa. Microeconomic theory can also be applied at the discretion of the economy, namely by using price theory to analyze the actions taken to affect the economy. » Read more: Scope of Micro Economic Theory