Question

What is Economics ?

Hint:

Economics is often called the "Dismal Science," but it is actually the logic behind every decision we make in daily life.

Answer 1

Step 1: Understanding the Concept:
The fundamental problem of economics is "Scarcity."
Resources (Land, Labor, Capital) are limited, while human wants and desires are unlimited.
Step 2: Detailed Explanation:
Economics is essentially the "Science of Choice." Because we cannot have everything we want, we must make choices.
1. Microeconomics: Examines the behavior of individual units like a single household or a firm.
2. Macroeconomics: Examines the economy as a whole, looking at aggregates like National Income, Inflation, and Employment.
Different economists have defined it differently: Adam Smith focused on "Wealth," Alfred Marshall on "Material Welfare," and Lionel Robbins on "Scarcity and Choice."
Step 3: Final Answer:
Economics is the study of how individuals and society choose to employ scarce productive resources to produce various commodities and distribute them for consumption.