Economics is concerned with the approach limited methods are distributed/allocated among alternate uses to satisfy unlimited man wants. It assists to understand the type and business of world and the operation and behavior of organization firms and also other economic decision-making units.
Microeconomics deals with the economic actions of specific units (consumers, firms, source holders): just how scarce resources are given among substitute uses; the role of prices and marketplaces.
Macroeconomics is involved with the overall economy as a whole or the behaviour of economic aggregates вЂ“ GDP, Employment, Pumpiing, etc .
The economist gathers facts which might be relevant to concern of a particular economic problem вЂ“ descriptive or scientific economics. Economic analysts also condition economic concepts вЂ“ generalizes about the way individuals and institutions basically behaves sama dengan economic theory.
Induction вЂ“ from facts to theory, from the particular to the standard.
Deduction starts off at the level of theory and proceeds to the verification or rejection of the theory simply by an charm to the details.
Positive economics try objectively to foresee and describe economic tendency. It relates to facts which is devoid of worth judgement. Focused on " WHAT ISвЂќ.
Normative economics is where one's choice is depending on subjective worth judgement. This deals with " WHAT NEED TO BEвЂќ.
Example: Unemployment is definitely 12 % of the work force вЂ“ positive Lack of employment ought to be decreased вЂ“ normative.
Fallacy of composition вЂ“ to presume " what is true pertaining to the individual or part of a group is always true for the group as a wholeвЂќ. E. g. at a football game one person chooses to stand up to see better.