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The basic concept of Economics:
Economics is an integral part of science which deals with the process of analyzing the distribution, production and consumption of the available resources. It deals with the study of using the limited resources in a way that it manages the unlimited wants of human beings.
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Sub-divisions of economics:
The subject can broadly be classified into two categories-
- Macroeconomics- This deals with the study of both the national economy and global economy. It explains how an Economic system works.
- Microeconomics-It includes the study of how an individual consumer or a person behaves while spending his own capital and resources. It also studies how the government taxes and policies have its effect on various commodities and services.
Scope of Economics:
- It deals with an individual’s economic activities.
- In order to satisfy people’s wants, resources are essential.
- People have unlimited wants whereas there is scarcity of available resources.
- The way resources are produced, distributed and consumed, it determines people’s wants.
Importance of Economics:
- People should know how to have alternative wants by using limited resources.
- Understanding the use of limited resources to have the production of maximum outputs.
- It helps the government to handle the economic affairs of the state.
- It is important to solve the problems of poverty, excessive population growth, unemployment, etc.
Problems faced by Economics Students:
- Involves too much of mathematical calculations.
- Unable to understand the vital and complex concepts.
- It becomes difficult to understand and manage the assumptions.
- Some find it difficult to understand the human behavior.
- The answers to most of the economic problems change on the basis of the graphs, calculations and assumptions.
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