THE INDIVIDUAL AND SOCIETY:-
Most introductory textbooks of Economics begin by asking the question ‘What is Economics about?’ Although Economics is a vast subject and precise definitions are usually complex and controversial, it is not a difficult matter to give a simple and sensible answer to this basic question. Economics is essentially a study of the ways in which people provide for their well-being. Economists are concerned with the study of human behavior as a relationship between ends and scarce means which have alternative uses’ (Lionel Robbins).
MICRO AND MACROECONOMICS:-
Economics can be divided into microeconomics and macroeconomics. Microeconomics is the study of individual markets. (A market is an arrangement which links buyers and sellers.) For instance, an economist may study the market for compact discs. This will involve looking at the decisions and behavior of people who buy compact discs, the firms that sell the compact discs and any other groups which influence the price and availability of compact discs, such as the government While macroeconomics is the study of the whole economy. It includes, for example, the study of the nature, causes, consequences of unemployment, inflation, economic growth and international trade and government policy.
WANTS AND NEEDS:-
Economics, both macro- and microeconomics, is about the satisfaction of wants. It is necessary to be quite clear about this; it is people’s wants rather than their needs which provide the motive for economic activity. People go to work in order to obtain an income which will buy them the things they want rather than the things they need. It is not possible to define ‘need’ in terms of any particular quantity of a product, because this would imply that a certain level of consumption is right’ for an individual. Economists tend to avoid this kind of value judgment which tries to specify how much people ought to consume. It is...