Economics is most commonly described as a social science that examines the making, distribution, and consumption of goods and services. The study of economics also includes the study of labor, investments, income, land, tax and government spending. On a larger scale, economics addresses the combined performance of businesses, governments and countries as well as their relation to one another on a global scale. The study of economics results in theories concerning the forces of supply and demand and provides economists the tools to allocate wealth and shortage.
Macroeconomics serves as a complimentary division of Economics. Microeconomics focuses on the monetary behavior and relationship of individual consumers, small economic groups and businesses. Microeconomics is used to better understand the financial decision-making processes between individual buyers and vendors and the causes that sway their choices. This practice traces patterns of supply and demand in smaller markets and helps determine cost and productivity.
Supply and demand are key elements in Microeconomic and Economic study. Understanding, the fluctuations in supply and demand help in determining cost and competition in a market place. Supply is a product or service available for purchase at a certain price. The amount of a supply is dependent of how much the consumer is able to produce and at what price it is being sold. The relationship between the amount supplied and its price is referred to as the supply relationship. According to the law of supply, the higher the rate, the higher the number of productivity. By doing so, the seller is increases revenue by selling at a higher rate while demand is high.
Demand is the need for a specific product or service. The amount of ...