Economic Definition

Definition of Economics and Basic Concepts of Economics

This is hustle you are read economic scatter in this site tutorial we shall discuss about the definition of economics and basic concepts of economics so let's get started first we shall learn about the definition of economics economics is the science of scarcity which means we have unlimited wants but limited resources.

In this picture you can see that individuals have unlimited wants but in this picture you can see that he has also limited resources so how he can utilize his limited resources to make the best choice he lies to fulfill his wants there are multiple definitions of economics but according to economics cater this definition is perfect, Now we shall discuss the basic concepts of economics there are two common concepts of economics one is microeconomics and the other one is macroeconomics.

Microeconomics is the study of small units of an economy such as individuals firms and industries so in microeconomics we study the individuals behavior how they choose and make choices when they have limited resources and the study of firms when it comes to the production how they produce and distribute among the consumers and the study of industries etcetera but when it comes to microeconomics.

Macroeconomics is the study of large units of an economy such as aggregate demand and supply inflation and in climate level etcetera so in macroeconomics we include the whole country or you can say the whole economy the most common concept of economics is trade-offs when you gave up all the alternatives and make one choice is called trade-offs.

Next concept we have is opportunity cost the a which we gave up to get another good B so the good a is the opportunity cast off could be we also say that the opportunity cost is the thing which we gave up to get another thing so this was the example of opportunity card. Investment is the money we spend in businesses to improve production so the money which we use for more production is called investment consumer goods are those goods which are created for direct consumption for example piece of clothes shoes etc and capital goods are those goods which are used to create our produce other goods juicer blender our printer etc so that was all if you have.

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