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Understand the Basics of Economics in 4 Quick Ways

by Oct 25, 2016Economics

‘‘Economics is everywhere, and understanding economics can help you make better decisions and lead a happier life.’’
No matter what career you want to pursue ahead in your life, you need to have a good understanding of it. It is only when you plan a stem properly, that you can expect it to take the shape of a tree. Similarly, to have a successful academic or professional career ahead, you need to have a strong understanding of your key concepts.
So, you want to have a profitable career in economics, right? But how versed are you in your subject? Memorization of a topic may help you to pass the hurdle of exams, but that is not sufficed for a long-term achievement. Just securing excellent academic grades at the end of a semester is not helpful in long run.
‘‘The larger the island of knowledge, the longer is the shoreline of wonder.’’ Thus, the better is your understanding of the vital concepts; the longer will it help you in making a successful economics career. This is more important in a subject like economics as the better are your understanding of the theoretical concepts; the better can be its implications in real-life.
It often happens that once you reach the higher secondary level or start your undergrad course, you need to solve an assignment where you are supposed to work according to the basic concepts. It is during the times that you look for quick solutions to understand the concepts that you memorized blindly once.
Basic Economic Concepts
Before discussingquick ways to understand the basic concepts, let us brush up the key concepts once-

  1. Scarcity

The study of scarcity refers to the tension between the Earth’s limited sources and the unlimited wants and needs of a man. Limited resources include natural resources, labour force, capital and technology.
With the limited availability of resources, it is important for nations and individuals to decide regarding what services and goods can be bought and which needs to forgo.

  1. Macroeconomics and Microeconomics

Macroeconomics looks at the total production of a nation and the way it allocates these resources to have maximum production. Microeconomics too looks at the same issues in case of individuals and organizations within the country. This process is more scientific in approach as compared to the other. Both these concepts are interlinked and together they help experts to judge the economic standing of a country.

  1. Law of Demand and Supply

The law of demand and supply are considered as the most fundamental concepts of economics. The concept of demand refers to the quantity of a product or service as per the want of the buyer. The quantity demanded by a consumer is the amount of a service or good that he is ready to purchase at a given price.
On the other hand, supply refers to what the market can offer at a certain price. The quantity to be supplied is the amount that producers are willing to supply to buyers at a particular price.

  1. Elasticity

Elasticity refers to the degree to which a demand or supply curve reacts as per changes in the price of a product. The prices of necessary products are the ones to be worst affected as no matter what happens with the price; consumers will buy them.
Goods, where a slight price change may lead to changes in demand and supply, are considered to be highly elastic.
Though Economics is a vast subject to study, students need to have a good conception about some of the most important basic concepts, vital in ahigher level of economic studies.
Ways to understand the basic concepts quickly
College education is a different ball game altogether. In order to succeed in economics, one needs to have a good understanding of the concepts. One can quickly derive this understanding through the following ways-

  • Make Books your new bestie

Books are the best guidance you can ever have. No matter how poor your understanding of the topic is, with proper books, you can have the best knowledge. You can get hold of any introductory economic book which deals with the concepts of the subject.
Try to get hold of books which provides graphical representations of every topic and theory. You can refer to books like- The Essentials of Economics by Gregory Mankiw, Economics in One Lesson, etc.

  • Open online courses

It is true that you can never get back to your school for understanding these concepts in detail. But what about joining online economic courses? There are universities who have got courses designed for basic economic understanding. Universities like Yale and MIT offer online courses in Economics which offer challenging and stimulating experience.

  • Study calculus and linear algebra

It is a well-known fact that Economics and Mathematics are inter-twined. Both Calculus and Linear Algebra are equally important for solving differential equations in any econometric model.
Both calculus and linear algebra go hand in hand for undergraduate economics students while dealing with econometric models. Calculus even helps you while solving the constrained optimization problems. Thus, you need to have a good hold on these.
If you are unable to decide whether economics will be a good career option for you or not, refer to- which is better as a career option- Statistics or Economics?

  • Take educational help

You can even consider taking educational help in the form of-

  • Expert guidance:

You can consider talking to economics experts for educational help. Consider joining an online educational forum where you can come in contact with professionals who are pioneers in this field. You can post your query directly or simply join an existing discussion.

  • Professional tutors:

Why not seek help from tutors? You can either hire a personal tutor of your own or refer to professional economics tutors at various online educational websites. These tutors can provide individual attention to your queries.

  • Group study:

One of the best ways to solve a problem quickly is through a group study or group discussion among classmates. Conduct a group study with students who hold good command in economics. Not only will your personal problems be solved but you will come in contact with various other queries faced by other students.
Now with such quick solutions, don’t you think that understanding the vital concepts of economics is easier than you thought? Try out the ways and see the results for yourself.