1. Introduction To Economics

Economics is the study of wealth and human behavior. It is the study of how people make choices in the face of limited resources and unlimited wants.

In simplest terms, the study of human being and their choices is called economics.

Economics asks why a customer will buy something, what is the relation of want with cost, amount of purchase, etc.

Origin of Economics

The word economics is derived from the Greek word oikonomia which means household management.

Needs drives human activities. For example, in the past, people used to hunt for food. This is the simplest form of economics.

After agricultural evolution, people start to grow food. One might produce wheat and another might be fish farming. They exchange their products, in which both are benefited. This is the second form of economics.

In modern days, the nation and border of countries creates a complexity in global economics system. One can not simply buy something from a different country. There are many rules and regulations from government one must follow. This is the third form of economics.

Why study Economics?

• To understand the cause, which is driven by economic reasons, and consequences of decisions.
• Being able to make the optimal choice.
• Be an informed decision maker.

Economics in our life

• Most wars in the past and present are caused by economic reasons. Those economic reasons include not only the want of money but land, workforce, natural resources, etc.

• On personal life, economics allows us to make informed decisions about our life. It gives us answer to many questions like why and where to invest money, how to invest money, how to save money, etc.

Acknowledgement

• Reference: Class Lecture