Professional Documents
Culture Documents
F.Y.B.M.S.
By-
WHAT IS ECONOMICS ?
Economics is the social science which deals with the
economic behavior of mankind. The word economics is
derive from two Greek words oikou and Namos means
the rule of the household.
Adam Smith the father of economics defined economics
as the study of wealth in his book wealth of the nation.
Alfred Marshall, the neo-classical economist considered
economics as science of welfare.
Lionel Robbins defines economics as economics is the
science which study human behavior as a relationship
between end and scars means which have alternative
uses.
Economics activities are carried out at individual level of
whole country therefore the subject matter of economics
is divided in to two parts namely Micro Economics and
Macro Economics . This were introduce by Prof.Ragnar
Frisch in 1993.
Micro economics
The term micro is derived from Greek word mikros which means small
or millionth part.
Micro-economics deals with an analysis of the behaviour of individual
economics units in entire economy in detail.
According to Prof. Kenneth Boulding, micro-economics is the study of
particular firm, particular households, individual prices, individual wages,
individual income, individual industries, etc.
According to Prof. Maurice Dobb, micro-economics is a microscopic
study of the economy. It deals with the working of markets for individual
commodities and the behavior of the individual consumer and products
SCOPE OF MICROECONOMICS
FEATURES OF MICRO-ECONOMICS
Nature of Analysis
Method or Approach
Scope
Application
Nature of Assumptions
USES OF MICRO-ECONOMICS
MACRO-ECONOMICS:
The term macro economics is derived from the Greek word
makros which means large.
Macro-economics deals with an analysis of large aggregates and their
averages in the economy as a whole rather than with particulars items in it.
It analyses the working of the whole economic system
According to Prof. K. E. Boulding macro-economics deals not only with
individual quantities as such but with the aggregates of these quantities;
not with individual difference but with the national income; not with the
individual price but with the price level; not with individual output but
with the national output.
Macro Economics
MANAGERIAL ECONOMY
PROCESS OF DECISION-MAKING
Business firms have to make a number of decision both in the short run and
long run. Decisions related to what to produce, where to produce what
technology should be used etc are very crucial to the survival of the firm in
the short run.
Decision related to enhancing capital investment, expanding market and
introduction of new product have to taken in long run.