Explain the nature and scope of economics with and example?

Answer 1

Economics is the social science that studies the production, distribution, and consumption of goods and services

A definition of modern economics is that of Lionel Robbins in a 1932 essay:

"the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses."

Scarcity means that available resources are insufficient to satisfy all wants and needs.

Economic concepts

Common problems among different types of economic systems include:

* what goods to produce and in what quantities (consumption or investment, private goods or public goods, etc.)

* how to produce them (coal or nuclear power, how much and what kind of machinery, who farms or teaches, etc.)

* for whom to produce them, reflecting the distribution of income from output.

The subject thus defined involves the study of choices as they are affected by incentives and resources

Areas of economics may be divided or classified into various types, including:

* microeconomics and macroeconomics

* positive economics ("what is") and normative economics ("what ought to be")

* mainstream economics and heterodox economics

* fields and broader categories within economics.

One of the uses of economics is to explain how economies, as economic systems, work and what the relations are between economic players (agents) in the larger society.