Economics is very integral part of our society - Each country is affected by the "economics" of their society

The economics of each culture is affected by consumption, production, reproduction, interest rates, inflation, and deflation. Economics studies the production, distribution, and consumption of commodities. Economics is usually divided into two main branches:

Microeconomics examines the economic behavior of individual units such as businesses and households in face of scarcity and government interactions, as well as the economic consequences of these decisions on other actors.

Macroeconomics examines an economy as a whole with a view to understanding the interaction between economic aggregates such as national income, employment and inflation. The general equilibrium theory combines the concept of a macro-economic view of the economy; however it does so from the microeconomic viewpoint. Many, many attempts to join the two branches or to distinguish the precise distinction between them have been important motivators in much of recent economic thought. This proved to be especially true in the late 1970s and early 1980s. However, the consensus view is arguably that good macroeconomics has solid microeconomic foundations in the world today.

A few authors (for example, Kurt Dopfer and Stuart Holland) also argue that 'mesoeconomics', which considers the intermediate level of economic organization such as markets and other institutional arrangements, should be considered a third branch of economic study. Economics can also be divided into numerous sub disciplines that do not always fit neatly into the macro-micro categorization. The sub disciplines of economics include the areas of international economics, development economics, industrial organization, public finance, economic psychology, economic sociology, institutional economics and economic geography.

There are many schools of economic thought, but let's focus on mainstream economics. This begins with the premise that resources are scarce and that it is necessary to choose between competing alternatives. In simpler terms, economics deals with many tradeoffs. Economics constantly is choosing one alternative implies forgoing another alternative—the opportunity cost. To that end, the opportunity cost designs an implicit price relationship between the competing alternatives. In addition, both markets oriented and planned economies, very seldom are often explicitly higher by price relationships.

Economics provides us a study of how individuals and societies seek to satisfy needs and wants through incentives, choices, and allocation of scarce resources. It is said that Alfred Marshall in the late 19th century informally described economics as "the study of man in the ordinary business of life".

Economics provides an understanding of choices by individuals and groups are the central notion. Most economists (those who study economics) believe that through many incentives and desires they play an important role in shaping decision making. The concepts from the Utilitarian school of philosophy are used by economists by analytical concepts within economics. Even though economists do appreciate that society may not adopt utilitarian objectives. Then there is the idea of a utility function.

It is assumed to provide adequate information on how economic agents rank the choices given to them. The utility function often ranks available choices from best to worst, and the agent gradually learns to choose the best-ranked choice in the feasible set of his alternatives.

Robin C. Trehan is an expert in the filed of mergers and acquisitions and private equity capital. He can be reached at robin@tafunds.com 

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