Importance of Economics
ECONOMICS is all around us because most, if not all, the things that we consume, buy, produce, or share should require time in deciding whether or not to purchase or spend resources for it.
Economics is about the optimal distribution of resources to members of the society despite we have scarce resources and there are a lot of people who demand to have these resources. We need to know how much should be given for what purpose and for which individual or group, depending on whether we manage our own resources or those of a group, community, company, country, or economy as proper management of resources bring great results.
In economics, there are microeconomics or the study of economics at an individual, group, or company level and macroeconomics or the study off the economy of an entire country or economy.
Societies, government, businesses, households, and individuals allocate its scarce resources like their respective budgets for different purposes and it must be done wisely to maximize the resource they have without depleting it.
In giving a certain amount or quantity of resources, we must always be mindful of the opportunity cost. The opportunity cost is about whether or not an option is more beneficial than the other option or options. Being able to figure out the opportunity cost of each option will help the decision maker come up with the most beneficial decision. Who knows something that is expensive in the short-term will save the entity a large amount of money in the long-term?
We also need to know why we, the community, the country, or the economy is in the state that it is in when it comes to their economics like poverty or getting only a small income, unemployment, low economic growth/ low financial growth.
The different principle in economics as well as our knowledge in finances will help us foresee the possible long-term effects of a particular move through forecasting.
We also need to know why do people make decisions when it comes to economics like why do people purchase certain things.
Just like how the country’s future can be determined by how well the leaders handle its economy, individuals can prosper financially if they manage their microeconomic condition well.
Although economics is grand in scale, we can apply it in general in our personal lives and the macroeconomic aspect of it affects our lives also. ( Paid article)