Question

Economics

Answer 1

Economics is the study of production, consumption & distribution of goods & services. It studies the behavior of individuals, organizations, businesses & government’s choices on how they allocate resources to satisfy their needs & why they make them. The main principle of economics is that human beings have large no of needs & limited resources to satisfy it. Therefore they want to use resources in a productive & efficient way. This brings the concept of productivity & efficiency.

The study of economics can be further divided into two parts. Microeconomics & macroeconomics.

Microeconomics: This branch of economics studies the behavior of how individual consumers or producers make their choices. This may include individual people or business. Microeconomics include concepts such as supply & demand, price elasticity, quantity demanded & supplied. It also studies efficiency & costs associated with producing goods and services. The allocation & division of labor, uncertainty & risk factor are also studied in it.

Macroeconomics: Macroeconomics is the study of performance & structure of whole economy for example economy of a region, country, a continent or even the whole world rather than focusing on individual market. It includes concepts such as government fiscal & monetary policy, unemployment & employment rate, international trade, & national consumption & production. It studies the behavior of economic factors leading to recession, boom or depression in an economy which affect the GDP & business cycle in an economy.