Before going to the principles of economics, first of all, we have to know about the definition and types of economics. Only then, you can get a clear idea of what actually is economics.
What is Economics?
The meaning of economics varies according to where it has been used. But in general, economics is just a set of knowledge or information which deals with consumption, transfer of wealth and production. Also, we could define the economics in comparison with the wealth and growth of an organization or a country. When it comes to the country’s economical status, it clearly defines the enhancement and development of the country in financial terms. Economical status defines the financial wealth of a particular concern or a state or a country.
Types of Economics
Wherever we go, economics would be there. We cannot find any city or country without the economy. The economy or financial system still survives exactly because of two crucial factors. The first one is that, the production of products and goods are inadequate. Secondly, people would like to have adequate goods and products to meet their day-to-daydemands. Economy comes into an act if shortage of goods exists. I know, it would be little tough to understand the economics clearly at first point. If you want to get a clear idea about economics, you have to implement that in your daily life.
Coming to the types of the economics, it is divided into two important types, which are microeconomics and macroeconomics. Microeconomics deals with the behavior and principles of a small unit or a firm or a state. From the name itself, you would come to know that, microeconomics covers only the small portion. But macroeconomics deals with the economical behavior of the total savings, investments, production and consumption of a country or large firm.
Microeconomics is the knowledge of a single unit or combination of several units. In this type, you would come to know about the consumer behavior of a particular industry, venue of an industry, product costing, financial status of the industry, factor pricing and details of a firm.
It is the study of a large organization’s savings and investments. By this type of economics, you would come to know about the economic growth of a state or a country, national income and outcome, external value and trade and payments.
Principles of Economics
As I said, economics is widely used all over the world to determine the financial status of a state or a nation. If that is being the case, you have to know something about the common principles of the economics, which are as follows,
- Theories of Business Cycle
- Laissez faire theory
- Economic determinism
If you know the above said principles, you could able to understand the economics clearly and briefly. But the point is that, we cannot predict the economic status of a nation or a state clearly as it varies every now and then.