Why Do You Think It Is Important to Study Economics?

Topics: Economics, Supply and demand / Pages: 8 (1914 words) / Published: Jun 6th, 2010
In this essay, it is my objective to be able to illustrate the importance and significance of economics in our daily lives. The Internet was mostly used as assistance in completing this essay. Also, the information here are gathered and reviewed from various Internet web pages and textbooks which can be found in the list of references at the end of this assignment.

To begin with, I shall start with the definition of economics. There is no exact definition of economics as it varies from the opinions among economist. However, many have chosen to agree with Alfred Marshall, a leading 19th century English economist, that economics is “a study of mankind in the ordinary business of life; it examines that part of individual and social action which is most closely connected with the attainment and with the use of the material requisites of wellbeing.” In other words, it also means that economics is a study of how in our daily lives certain actions or decisions are related to the acquisition and usage of material requirements in our daily routines. Additionally, economics is the study of how scarce or limited resources are used accordingly to satisfy people’s unlimited wants and needs. It is concerned with how people make decisions in a world of scarcity. In short, if there is no scarcity there would be no point in studying economics.

Perhaps one of the most fundamental concepts of economics is demand and supply. It is because of demand and supply that we are compelled to make choices as generally demand is great but at the same time we are lacking in supply. Firstly, demand refers to how much or the quantity of a product or service that is desired by buyers. The quantity demanded is the amount of a product that people are willing to purchase at a certain price; the relationship between price and quantity demanded is known as the demand relationship. If we were to look closer there is a Law of Demand which states that holding all nonprice factors constant, as a

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