Economics is all about making the right choices. In our daily routine, we make different kinds of choices, such as what are we going to have for dinner? What professional career to choose? What specialisation to select for higher studies? What type of political party to give a vote to make the economy better?
We all have heard about the word economic. It is a misconception of this student and the people that economics is all about money, however, it is not just about the money, it is about to have how are you to see and weigh different choices and alternatives. Meaning of these choices can be based on money but not all of them. There are many choices we make on our daily routine which does not include money, still, they are considered as the subject of Economics. Let’s understand this through an example, you are doing a part-time job to support your academic and social life at the same time. In many of the scenarios, money is just considered as a tool that assists you to make the right choices about the goals you have selected.
Many people think that economics is all about being effective and efficient will not making any kind of wrong choices about how you spend your money and how you budget your time. You cannot deny this but it is just the beginning of the economics. It is right that we can be more efficient in saving money through effective planning. In many of the cases, we cannot or we don’t select the make the most effective options. Economics is all about why we do and don’t make the most effective economical choices.
Students who have pursued their career in the field of Economics have to deal with a variety of assignments. Writing an assignment on economics has never been easy for the students because they have to get the complete knowledge and details of the selected topic before writing anything about it. It demands a good amount of time along with the interest in the subject to meet the standards and requirements effectively and efficiently. Professional economic assignment writers can help you to get the right amount of understanding of the concepts and the procedures involved throughout the economics assignment writing.
Let’s understand the basics of economics through key points;
- Economics is a study which involves the choices of the human under the conditions of scarcity.
- Scarcity takes place when the wants of humans for goods and services actually exceeds the available supply.
- Here, people make their decisions based on their self-interest while weighing the cost versus benefits.
What Is Scarcity?
There are valuable resources in our life which include money, material, land, Labour, and many other things. But all of these valuable resources have limited supply. They can never be enough to meet our wants and needs of human nature. This specific condition is called scarcity.
At all moments in time, there are always a limited amount of resources that are available. Even if you think that you have a large number of resources, still it’s limited. For example, the total area of UK is 224,820 square kilometers, this may seem used to you but it is not infinite but limited. Due to limited resources, there is also a limitation in the production of goods and services. Now you can combine this scenario with wants of the humans which are infinite and you can see why scarcity is an issue.
Because of the limited resources, we have to make the choices accordingly. As we discussed earlier, that economics is all about the human choices made under the scarcity conditions.
What Is the Problem of Scarcity?
It is important for every society to make the best possible use of the available resources. A decision of the families to spend their money e on buying a new vehicle or to go for the vacations. Different towns of the city have to decide what to include and what to exclude throughout the yearly budget. I have seen many scenarios where there is not enough money in the budget to do everything required. The basic purpose of economics is to help us understand the decisions taken by the families, business, organisations, individuals, or societies and to understand that the available resources and never enough to meet all the needs and wants.
What Is Opportunity Cost?
When you have limited resources you always have to make a choice of how to use them but at the same time, you are forgoing the other options as well. There is a term used in economics called as opportunity cost. This term indicates that what you must forego to obtain the other thing you want. It is a principle of Economics that every choice you make has an opportunity cost. If you are making a choice to sleep throughout your lecture, then the opportunity cost would be the entire learning that you miss throughout the lecture. If you wish to play with your friends instead of completing your homework, then homework would be your opportunity cost. We have to deal with the opportunity cost with every decision and choices we make throughout our life.
In short, opportunity cost can be defined as the value of the next best alternative that you could have been chosen.
Individual Decisions and Opportunity Cost
In many of the cases, understanding the opportunity cost can actually change the personal behaviour of the individual. Let’s understand this to an example, let’s say that you are spending 10 pounds on your daily lunch at University, and when you take lunch from home it costs around 4 pounds. So the opportunity cost of buying your lunch every day at University would be 6 pounds.
Economics is a wide and vast subject which requires a good amount of interest and knowledge if you want to prosper throughout the specific and respective field of academics. It is not only about academic but it is highly demanded in the daily life of the individuals regardless of any nature. I always recommend students to get the right understanding of the subject if you want to enhance their grades throughout the semester. The above mentioned and discussed factors would allow you to understand the basics of Economics.