Wait a second!
More handpicked essays just for you.
More handpicked essays just for you.
Why is the study of economics important essay
Why economics is important in our daily life
Why economics is important in our daily life
Don’t take our word for it - see why 10 million students trust us with their essay needs.
Recommended: Why is the study of economics important essay
In Microeconomics, there are many subjects that gave me interest in investigating to progress in my professional career as an Accountant. For three years and throughout this semester, my studies in Accounting at Dalton State College have given me more interest getting into the business program to get a job as finance accountant. Microeconomics shows which cause a departure from these economic efficiencies and the result in the decline of the social welfare at its maximum level. Economic efficiency involves in three efficiencies; efficiency in production, efficiency in the production of goods among the people, which it is also called efficiency of consumption, and allocative economic efficiency that’s in the direction of production efficiency. …show more content…
Consumption efficiency takes into account all the factors that decrease effectual value of a company: satiation, maldistribution, and other various output losses. Also, it consists of distributing the given amount of goods and services among the millions of people that consume in order to maximize the society’s total satisfaction. To illustrate this, the final output’s effectual value must be divided by its potential value and the consumption efficiency must be equal to that result in order to achieve one-hundred percent efficiency (Rottering). Even if the consumption efficiency and production efficiency are both present, it will result of goods that are produced and consumed but not preferred by the consumer’s …show more content…
Additionally, it implies that the patterns of production should correspond to the desired pattern of consumption to the people. For example, have you ever gone birthday shopping for a five-year old? While you may not have been familiar with the hottest toy of the moment, your trip to the toy store might have shed some light on what to buy (Whiting). Furthermore, in order to achieve this type of efficiency, the resources must be allocated to the production of various goods that the maximum satisfaction can be obtained. In other words, once that is achieved, the marginal benefit or the amount of cash the person pays for the product will equal the marginal cost or the amount the company has to spend in order to make extra units of a good. To Summarize, Microeconomics illustrates which cause of departure from the economic efficiencies and the result of decline and social welfare at its maximum potential even though the efficiency of production, efficiency of production among the consumers, and the allocation economic efficiency are included in economic efficiency. Even though economic efficiency shows us the way of how the economy works, it should be noted that microeconomics does not study the economy as a whole but a small part and inter-relationships of every
According to BusinessDictionary.com, “Production is the processes and methods used to transform tangible inputs (raw materials, semi-finished goods, subassemblies) and intangible inputs (ideas, information, knowledge into goods or services. Resources are used in this process to create an output that is suitable for use or has exchange value”. While “Consumption is the process in which the substance of a thing is completely destroyed, used up, or incorporated or transformed into something else. Consumption of goods and services is the amount of them used in a particular time period”.
Common Sense Economics: What Everyone Should Know About Wealth and Prosperity, written by James Gwartney, Richard Stroup, Dwight Lee and Tawni Ferrarini, explains the foundation of economics and how it all works in all aspects of our lives from the role of the government trickling down to personal credit cards and savings. This book was written with clear language for the audience to understand and comprehend the large amount of information within its condensed size. The authors’ target audience for this book seemed to be for those individuals wanting to learn the mechanics of economy including economic growth and stability. Gwartney separates his book into four parts: Part I, Twelve Key Elements of Economics, Part II Seven Major Sources of Economic Progress, Part Three Economic Progress and the Role of Government, and Part IV Twelve Key Elements of Practical Personal Finance.
Efficiency is concerned with the optimal production and allocation of resources given existing factors of production while equity is concerned with how resources are distributed throughout society (Pettinger, 2010). The equity-efficiency trade-off is an economic situation in which there is a perceived tradeoff between the equity and efficiency of a given economy. This tradeoff is commonly viewed within the context of the production possibility frontier, where any additional gains in production efficiency must be offset by a reduction in the economy 's equity. Within this equity and efficiency tradeoff, equity refers to the economy 's financial capital, while efficiency refers to the future efficiency in the production of goods and services. This theory asserts that, in order for a nation to
This highlights that a core principal of economics is the decisions and choices to be made in order to manage limited resources. Furthermore, that microeconomics pertains to the behaviours that affect these decisions and choices made at an individual level. As demonstrated by the avocado industry recently, motives and variable factors for increases/decreases in supply and demand will not always be transparent to the consumer. Therefore, to have an understanding of the concepts of microeconomics and the market can elucidate the individual consumer’s decision making rationale rather than making
In the same manner, one tries to economize with their time resources. They must be so distributed as to give an equal yield in all sects of use. Otherwise, it would pay t...
Social efficiency is related to the concept of the government intervening in a situation where the costs pertaining to a firm or a number of firms acting in a specific way is higher that its benefits. One might want to say for correctness purposes that one achieves social efficiency when "the marginal benefits to society - or marginal social benefits (MSB) of producing any given good or service exceed the marginal costs to society or marginal social costs (MSC)." [2]
The Economy is the backbone to society. There are many factors that operate in, and govern our society’s economical structure. Factors such as scarcity and choice, opportunity cost, marginal analysis, microeconomics, macroeconomics, factors of production, production possibilities, law of increasing opportunity cost, economic systems, circular flow model, money, and economic costs and profits all contribute to what is known as the economy. These properties as well as a few others, work together to influence the economy. Microeconomics and Macroeconomics are two major components. Both of these are broken down into several different components that dictate societal norms and views.
Economics is defined as is the social science that studies the production, distribution, and consumption of goods and services. It primarily deals with the exchange of value and that labor or human effort is the source of all value. The field may be divided in other ways, most commonly microeconomics vs. macroeconomics. Microeconomics examines the economic behavior of individual units, including businesses and households, and their interactions through markets, given scarcity and government regulation. Macroeconomics examines an economy as a whole "top down" with a view to understanding interactions between the broadest aggregates such as national income and output, employment and inflation and broad aggregates like total consumption and investment spending. Econometrics is the application of statistical techniques to measuring economic phenomena.
This paper provides a critical assessment of the performance of organizations which could be linked to economic theories and concepts. Through a review of various literature, research and conclusions of economists such as Friedman (1970), Coase (1937), Williamson (1981, 1998, 1975), Sloman et al. (2013), Powell (1990), Taylor (2011, 2012) and so on, the researcher presents a critical assessment of the microeconomic and macroeconomic concepts which were found to affect performance of a typical organizations. The concepts were also linked to other aspects of economics ...
Although small businesses do not make a lot of major deals with large investors, most small businesses create profit revenue greater than large corporations. Small business creators are very brave considering only ten percent of small businesses survive. Unfortunately, some communities do not support local small businesses; they only support the large brand name and force small businesses to die out. Since small businesses will not have a name brand known around the world, many people from communities will not support them because they are not known on a national scale. “This, in turn will affect the local economy and drive capital out of their local economy. On average, for every one hundred dollars spent in an economy, if spent on a
The crucial importance and relevance of economics related disciplines to the modern world have led me to want to pursue the study of these social sciences at a higher level. My study of Economics has shown me the fundamental part it plays in our lives and I would like to approach it with an open mind - interested but not yet fully informed.
A production Function in general, without specifying what kind, is related to the output of a production process which starts which starts with the factors of production. The production functions are an integral part for explaining marginal products as well as allocative efficiency. There are different classifications for production functions, and what constitutes them, determined by the type of production. This article of the WIKI aims to focus on the Substitional production function, explaining what it is and means, as well as the limitational, doing the same. (1)
Efficiency is highly prized in a culture turned toward productivity. It is therefore cultivated in contemporary business administration theories. It also tends to be prized above all other values in modern society, as society is more and more oriented toward technological advancement. Efficiency is also defined here as the most economic or the shortest or fastest or most simple way of realizing or achieving a goal with the least cost.
According Spencer and Siegelman managerial economics accommodates traditional theoretical concepts to the actual business behavior and conditions by amalgamating tools, techniques, models as well as theories of traditional economics with actual business practices and environment in which a firm operates. According to Edwin Mansfield, “Managerial Economics attempts to bridge the gap between purely analytical problems that intrigue many economic theories and the problems of policies that management must
What is Microeconomics? This question was left unanswered when I initially enrolled in this course. Microeconomics is the social science that studies the implications of individual human actions, specifically about how those decisions affect the utilization and distribution of scarce resources. Microeconomics shows how and why different goods have different values, how individuals create more efficient or more productive decisions, and how individuals best coordinate and cooperate with one another. Microeconomics does not try to explain what should happen in a market, but instead only explains what to expect if certain conditions change. For instance, If the price of the new iPhone 8 is higher than the previous model will the consumer buy it? There are several elements that will play into getting an answer for this question, but gives you a general idea of what microeconomics entails.