2. What is Economics?
Economics is the study of the
allocation of resources among
alternative uses to attain desired ends.
It is a branch of social science which
deals with the study on attaining
human wants and needs.
3. Divisions of Economics
Macro Economics
The study of economics as a whole.
It is concerned with issues and
problems concerning the overall
economy of a nation or the world.
4. Divisions of Economics
Micro Economics
The study of individual parts of the
economy.
It is concerned with issues and
problems facing the individual
components of the economy (supply,
prices of goods etc..)
6. Needs and Wants
Needs
These are goods and services that
people needs in order to live.
Without these things, people cannot
survive.
7. Needs and Wants
Wants
These are goods and services that
makes the lives of people easier and
comfortable.
People can do away with wants, but it
makes their lives more meaningful.
8. Points to Remember
Wants and Needs vary from one person to
another.
Example: To an office worker, a cellphone is
considered as a need but to a farmer it is a
want.
Wants and needs are never satisfied.
Example: Cellphone models changes as time
goes by. It may be in today but will become
obsolete in the future.
9. Economic decision
We have unlimited wants and wish to
satisfy those wants with available
resources, we have to make choices.
Economic choice involves the
attainment of desired ends through the
allocation of these scarce resources
among alternative uses.
10. Factors that affect Economic
Decisions
Desired ends – whatever goal or
objective is identified as urgent.
Allocation – distributing resources so that
the desired ends are satisfied, partially
satisfied or not satisfied at all
Alternative uses – refers to the many
different choices which are equally
appealing
11. Scarcity
Scarcity exists when the
resources of the economy are not
enough to meet the wants or
needs of people or the society.
12. Types of Scarcity
Physical Scarcity – when resources
needed to satisfy wants and needs are not
available
Psychological Scarcity – when resources
are available but cannot be used by the
person or entity to satisfy their wants or
needs
13. Points to Remember
To attain wants and needs, people
must make use of wise economic
decisions to prevent scarcity. This
can only be achieved by a
comprehensive understanding of the
basic principles of economics.
14. To download this file, go to:
http://www.slideshare.net/ArnelSSI
