Economics

2 Pages 594 Words

Economics is the social science dealing with the use of scarce resources, to obtain the maximum satisfaction, of society’s virtually unlimited economic wants. Also it is concerned with the production, distribution, exchange, and consumption of goods and services. Economists focus on the way in which individuals, groups, business enterprises, and governments seek to achieve efficiently any economic objective they select. Economics can be divided into two major fields. The first, price theory or microeconomics, explains how the interplay of supply and demand in competitive markets creates a multitude of individual prices, wage rates, profit margins, and rental changes. Microeconomics assumes that people behave rationally. Consumers try to spend their income in ways that give them as much pleasure as possible. Macroeconomics, deals with modern explanations of national income and employment. Now that we understand what some of what economics is about I will attempt to define economic as a science of scarcity and also see why others define it as a science of choice and tell you if they are mutually exclusive?
A basic principle in every economic system even one as large and wealthy as the U.S. economy is that few, individuals ever satisfy all of their wants for goods and services. That means that when people buy goods and services in different markets, they will not be able to buy all of the things they would like to have. In fact, if everyone did have all of the things they wanted, there would be no reason for anyone to worry about economic problems, but no nation has ever been able to provide all of the goods and services that its citizens wanted, and that is true of the U.S. economy as much as any other. Scarcity is also the reason why making good economic choices is so important, because even though it is not possible to satisfy everyone’s wants, all people are able to satisfy some of their wants. Every nation is able to ...