The home beans are the same as the human beasts are. The human beasts are Natural resources include land, mineral resources, water (a bundle of desires. The resources are natural, financial, and human. resources, forest resources, etc.
For managing the resources, the people make choices it economics is also known as the science of choices. For example, a piece of land can be used for a different purpose such as to build a house, for office use, etc. People take a decision based on several factors. Similarly, if a man has $ 500 US, he will satisfy his wishes by making choices with his financial resources are limited. Economics is all about. making the best of things.
Opportunity cost is opportunity lost. For instance a man has $ 2 US with him. His choices to satisfies his desires are as to spend this scarce $ 2 US for 1. to drink a coke, 2. Buy a pizza, 3. Have a beer, etc. If he sees $ 2 US for pizza the opportunity cost of pizza is the opportunity lost ie, coke.
Wants, efforts, and satisfaction are in a cyclic nature and then never ending. These endeavors are in the form of different economic activities such as 1. primary economic activities like agriculture, forestry, dairying, etc 2. The secondary economic activities like manufacturing industries and 3. The services sector which is banking, insurance, teaching, transportation, etc.
The subject matter of economics revolves around Production, Consumption, Distribution and Exchange.
For instance, Japan has neither satisfactory levels of natural resources nor the human resources since it depends heavily Japan imports iron ore from India. India there are abundant natural as well as human resources. The quantity of population is too high since some other countries like the USA, and many others countries engagement the Indian human resources too in the production of goods and services.
There are various laws in the economics which explain the consumer behavior the individualization curve analysis is one of them.
After the wealth is created, the land has to be paid rent, the labor gets wages, capital has to be paid interest, and finally the organization gets the profit as it Therefore every organization or a firm tries to maximize its profits by reducing its expenditure on the remaining factors of production.
As mention elsewhere earlier all the goods and services, hence exchange some goods and services. In other words some countries have comparative and or cost advantage in in certain certain goods and services services over other nations. When the currency was not invented there was a barter system of exchange where goods were exchanged for goods or services.
According to the law of such, 1. law the demand, 2. the law of supply, 3. the law of diminishing marginal utility, and 4. The law of diminishing marginal returns. According to the law of diminishing marginal utility, the additional increase the price of more than the increase in price This law does not apply to drunkards, book lovers, music lovers, etc. Finally the law of diminishing returns is applicable mostly to agriculture sector.
The fiscal policy & # 39; s objectives are reflected in a country & # 39; s budget every Fiscal policy and monetary policy are also known as the demand management policies. Similarly the monetary policy is a policy of the central bank of any nation. The management of supply money is done through interest rates, cash reserve ratio, etc. In other words the central bank manages the supply of money through various modes to increase or decrease the demand in an economic system.
