Economics is the branch of social science that deals with the study of
production, distribution and consumption of goods and services. In other
words, it is the study of how the forces of supply and demand allocate
scarce resources. The term economics comes from the Greek words, oikos
(house) and nomos (custom or law), hence 'rules of the house (hold)'.
Economics play an important role in all aspects of our life whether it
is social, political or economic as well as day to day matters. It is
based on this pillar that the progress of a country stands.
Economics is an integral part of a well-rounded liberal arts education.
It occupies a strategic place among various disciplines of social sciences,
and is considered as a field that often overlaps with the fields of political
science, sociology, geography, history and psychology. As the economic
way of thinking is so useful in making sense of the world around us, economics
has sometimes been called the 'queen of social sciences'. Economic analysis
is applied throughout society, in business, finance and government, crime,
education, the family, health, law, politics, religion, social institutions,
war and science.
Economics is the study of how individuals and societies choose to employ
scarce resources. It deals with, what goods and services will be produced,
how they will be produced, and how they will be distributed among the
members of society. Economics has two branches: microeconomics and macroeconomics.
Microeconomics studies the behavior of specific sectors of the economy,
such as companies, industries or households. Micro-economics explains
how demand and supply affect prices, wages, rentals and interest rates.
Its primary concern is to help consumers and investors to make their lives
better by increasing their earnings and satisfying their needs despite
limited resources. Macroeconomics studies a nation or the world's economy
as a whole, using data about inflation, unemployment and industrial production
to understand the past and predict the future. In macro economics, we
study the economic behavior of the large aggregates such as the overall
conditions of the economy in relation to total production, total consumption,
total saving and total investment in it.
The study of economics helps formulate an understanding of the effects
of financial actions and reactions, by individuals and institutions. Knowledge
of economic laws and principles enables entrepreneurs to have an ideal
combination of the different factors of production. An economy exists
because of two basic facts. Firstly, human wants for goods and services
are unlimited and secondly, productive resources with which to produce
goods and services are scarce. Therefore, an economy has to decide how
to use its scarce resources to obtain the maximum possible satisfaction
of the members of the society. Economics, guide consumers to distribute
their income in purchasing of different commodities in such a way that
they can satisfy their maximum number of wants within the given resources.
Those who specialise in this subject field are known as Economists.
They study and analyze the relationship between supply and demand of goods
and services and how they are produced, distributed and consumed. They
provide information to management that affects decisions on marketing
and pricing of products, economic forecasts, and the effect of government
policies on business. Economists also help in solving problems like unfair
wages, rapid population growth, people migration to city centers, high
crime incidence, and loss of human resources due to overseas migration.
