1 introduction. copyright © 2004 south-western/thomson learning economy...... the word economy...
TRANSCRIPT
![Page 1: 1 INTRODUCTION. Copyright © 2004 South-Western/Thomson Learning Economy...... The word economy comes from a Greek word for “one who manages a household.”](https://reader035.vdocuments.site/reader035/viewer/2022070413/5697bfc11a28abf838ca466a/html5/thumbnails/1.jpg)
1
INTRODUCTION
![Page 2: 1 INTRODUCTION. Copyright © 2004 South-Western/Thomson Learning Economy...... The word economy comes from a Greek word for “one who manages a household.”](https://reader035.vdocuments.site/reader035/viewer/2022070413/5697bfc11a28abf838ca466a/html5/thumbnails/2.jpg)
Copyright © 2004 South-Western/Thomson Learning
Economy. . .
. . . The word economy comes from a Greek word for “one who manages a household.”
According to Samuelson,
Economics is the study of how socities use scarce resources to produce valuable commodities and distribute among different people.
![Page 3: 1 INTRODUCTION. Copyright © 2004 South-Western/Thomson Learning Economy...... The word economy comes from a Greek word for “one who manages a household.”](https://reader035.vdocuments.site/reader035/viewer/2022070413/5697bfc11a28abf838ca466a/html5/thumbnails/3.jpg)
Copyright © 2004 South-Western/Thomson Learning
Microeconomics and Macroeconomics
• Microeconomics focuses on the individual parts of the economy.
• How households and firms make decisions and how they interact in specific markets
• Macroeconomics looks at the economy as a whole.
• Economy-wide phenomena, including inflation, unemployment, and economic growth
![Page 4: 1 INTRODUCTION. Copyright © 2004 South-Western/Thomson Learning Economy...... The word economy comes from a Greek word for “one who manages a household.”](https://reader035.vdocuments.site/reader035/viewer/2022070413/5697bfc11a28abf838ca466a/html5/thumbnails/4.jpg)
Copyright © 2004 South-Western/Thomson Learning
THE ECONOMIST AS POLICY ADVISOR
• When economists are trying to explain the world, they are scientists.
• When economists are trying to change the world, they are policy advisor.
![Page 5: 1 INTRODUCTION. Copyright © 2004 South-Western/Thomson Learning Economy...... The word economy comes from a Greek word for “one who manages a household.”](https://reader035.vdocuments.site/reader035/viewer/2022070413/5697bfc11a28abf838ca466a/html5/thumbnails/5.jpg)
Copyright © 2004 South-Western/Thomson Learning
POSITIVE VERSUS NORMATIVE ANALYSIS
• Positive statements are statements that focus on facts and cause and effect relationships. Called descriptive analysis
• Normative statements are statements about how the world should be. Called prescriptive analysis
![Page 6: 1 INTRODUCTION. Copyright © 2004 South-Western/Thomson Learning Economy...... The word economy comes from a Greek word for “one who manages a household.”](https://reader035.vdocuments.site/reader035/viewer/2022070413/5697bfc11a28abf838ca466a/html5/thumbnails/6.jpg)
Copyright © 2004 South-Western/Thomson Learning
SUBJECT MATTER OF ECONOMICS
• Economic activities
• Economic systems
• Economic policies
![Page 7: 1 INTRODUCTION. Copyright © 2004 South-Western/Thomson Learning Economy...... The word economy comes from a Greek word for “one who manages a household.”](https://reader035.vdocuments.site/reader035/viewer/2022070413/5697bfc11a28abf838ca466a/html5/thumbnails/7.jpg)
Copyright © 2004 South-Western/Thomson Learning
ECONOMIC ACTIVITIES
• Production• Consumption• Exchange
Objective of economic activities: 1.proper allocation of resources 2.efficient use of resources
![Page 8: 1 INTRODUCTION. Copyright © 2004 South-Western/Thomson Learning Economy...... The word economy comes from a Greek word for “one who manages a household.”](https://reader035.vdocuments.site/reader035/viewer/2022070413/5697bfc11a28abf838ca466a/html5/thumbnails/8.jpg)
Copyright © 2004 South-Western/Thomson Learning
ECONOMIC SYSTEMS
The economic system is composed of people and institutions, including their relationships to productive resources. Examples of contemporary economic systems include :
CAPITALIST ECONOMY
SOCIALIST ECONOMY
MIXED ECONOMY
![Page 9: 1 INTRODUCTION. Copyright © 2004 South-Western/Thomson Learning Economy...... The word economy comes from a Greek word for “one who manages a household.”](https://reader035.vdocuments.site/reader035/viewer/2022070413/5697bfc11a28abf838ca466a/html5/thumbnails/9.jpg)
Copyright © 2004 South-Western/Thomson Learning
ECONOMIC POLICY
• A policy is a deliberate plan of action to guide decisions and achieve rational outcome(s).
• Economic Policy are the actions that the government takes in economic field.
• e.g. Fiscal policy, monetary policy, trade policy, policy of setting interest rates.
![Page 10: 1 INTRODUCTION. Copyright © 2004 South-Western/Thomson Learning Economy...... The word economy comes from a Greek word for “one who manages a household.”](https://reader035.vdocuments.site/reader035/viewer/2022070413/5697bfc11a28abf838ca466a/html5/thumbnails/10.jpg)
Copyright © 2004 South-Western/Thomson Learning
Submitted for –www.mycollegebag.in