INTRODUCTION TO ECONOMICS

viewers and readers of this article, what is what in micro economics is

Specifically designed to help student understand the basic concept, underlying principles and facts about the real world of Micro Economics. Students are being mislead and deviated from what economics is supposed to impact in their mind set.

Economics is our everyday activities which everyone involved themselves in, so no one is an exception to the study of economics. At least minute understanding about some fundamental concept and principles with help a lot.

WHAT IS ECONOMICS?

Several school of thought defined economics but i’ll use the most common and general definition put forward by Lord Lionel Robinson. He defined economics as the Social Science, which studies human Behaviour, as a relationship between ends and scarce means which have alternate uses.

The key concept in this definition is:

·        Social Science

·        Human Behaviour

·        Ends

·        Scarce Means

·        Alternate Uses

Economics is defined as a Social Science, because it examines the way in which individual optimally utilize his resources to get maximum satisfaction. It follows the scientific process of observations, hypothesis, facts, proof, and theories on Human behavior.

Human Behaviours are the course of action which an individual usually undergo in order to satisfy those needs. Let’s take for example Micheal  wants to buy a given item which costing him 100 Naira, now he will have to go to the market to purchase that item with his money. By doing so he has satisfied those needs. All those process that he undergoes to purchase the item in order to satisfy those need are the course of action (behavioral trait).

Ends are wants and needs an individual want to have. Every individual want cloth, shelter, house, books, and shoes, name them all. All this needs and want an individual desire are referred to as ends. We can never have all the wants and needs because they numerous and unlimited relative to our Scarce resources. Scarce resources are the material needed to obtain our necessary needs and wants. That is why the study of economics comes in here in order to treat the problem of scarcity.

Scarcity comes in here when our resources need to satisfy our unlimited wants are limited. For example, Stephen wants to buy a shoe and a cloth both costing 100 Naira each, but he has only 100 naira with him. Now his resources (100 naira) is limited to his unlimited wants (shoe and cloth). Here scarcity sets in here.

Alternative uses are the means by which resources are used to satisfy those needs. From the example above, Stephen has to choose among his pressing need (shoe or cloth) given his available income (100 Naira).

From this article, we can see that the major problem in economics is scarcity and the study of economics sets in here in order to efficiently utilize our available resources to get a maximum satisfaction.

Hope this article was helpful. For more explanation, you can drop your comment below.

WHAT IS ECONOMICS (THE STUDY OF CHOICE)

Economics is regarded as the study of choice because the focal point of its prevailing existence is scarcity. Scarcity prevails when there are limited resources available to satisfy the varying wants. All individuals have numerous wants such as house, cloth, shelter, feeding, shoes, books, and payment of school fees, payment of house rent and countless number of want. But the problem here is that there is limited income to meet up these numerous wants, hence choice have to come in to solve these problems. The same applies to Firms; consumers have varying and numerous want but there are scarce resources (input)/factors of production which are unable to produce enough to meet up consumer wants and needs.

The illustration above has made it clear to us that the focal point of economics is scarcity which will result in choice. As a result of the scarcity, consumers and firms will have to react in a way (choice) to still get maximum satisfaction from their limited resources. So the need to study their reaction is of great importance and significance to the evolution of economics.