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Economics has been called and is known as a Social Science one that actually focuses on the subject matter that is concerned with the fair distribution, proper level production and the over all consumption of various Goods( products and services).
It is estimated that the history of Economics can be divided up into three distinctive eras, the first era being named, the pre-modern era, the second era being named the early modern era, and the third and final time span being named the modern era of economics. Regardless of that though the three eras are not very important as it has been observed that the systematic theory the most advances have been made with the advent or let say the birth of the modern era. The complete amount of credit for the development in this field can be attributed as it is seen through history to the late Scholastics and to be more specific the development can be attributed to the finding and contribution, rather to the overall over done in the study of economic to the Scholastics of the 15th and 16th century Spain.
Economics has been defined in many ways some say it’s the measurement of cost and production with reference to its actually consumption, some say it’s the level of production with respect to the distribution, some even say that economics generally refers to the developmental area of a country however one very specific definition that sort of does complete justice in explaining Economics is that one which calls economic that science that studies that human behavior as a relationship that occurs between the ends and the scarce means an those could have alternative uses. The word scarce here generally holds the meaning that the productivity or the availability of a certain resource is insufficient enough to fulfill the complete needs of the people.
Economics has two very main stream branches those
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For instance, Adam Smith’s theory of the invisible hand argues that when people engage in business and selling they are governed by the invisible hand of the market that helps regulate prices and ensures that businesses and people act in certain ways. Indeed, the nature of economics is like psychology in that it presents theories of human behavior.
As such, economic analysis relates to the study of economic systems in an industry to ascertain the effectiveness of the operations of a given industry with reference to its profitability1. With this, we are able to establish the optimum use of the limited resources to achieve a given economic objective.
Thus, short-run is the time period that quantity of an input or at least one of the many inputs is fixed while other inputs’ quantities can vary. Long-run on the other hand is that time period where inputs in entirety can be varied. Therefore, there is no specific time that can be taken as fixed or even marked on the dates of the calendar to distinguish short-run from the long-run.
If the quantity demanded of a certain product changes minimally or does not change at all, then that product is said to be a Price Inelastic Good. Consequently, if a product whose price increased and such a change brought forth an abrupt drop in quantity demanded of the same product, the good is said to be Price Elastic.
resources and maximizes his/her utility by selling it, since the economic problem of scarcity prevails; allocation decisions are made necessary by the market forces. Hence the point of interaction of the consumer’s demand curve and the producer’s supply curve is known as
sought to apply a broader theoretical and conceptual tradition of economic thought by placing emphasis on neo-classical synthesis – a combination of neo-classical economics and Keynesian economics.
Conservative economics is based on Milton Friedman’s teachings and
s the above figure illustrates, if there is a supply shock in an economy (such as increase in the price of oil, labor or other costs that increase the cost of doing business), the short run AS curve shifts to the left. The real GDP decreases from Q to Q’ and the price level
These tools enable professional mainstream economists to address various economic issues facing the world. Mainstream economics is about modeling in a way that traditional or heterodox economics is not. It originated from the neoclassical synthesis of the neoclassical
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