Practical Importance of Economics

January 17, 2021

Practical Importance of Economics

 

Economic is very important field of study its importance in every field of live. It help theoretically as well as practically to in every aspect of life to the person. some points are discussed about the practically importance of economics.

To solve Economic Problem    
Majority of the countries are facing the economic problems like inflation, adverse Balance of payments, unemployment etc. the study of economics not only help to understand these problems but after analyzing the causes cure is also proposed

To consumers
Our wants are unlimited and the means to satisfy these wants are limited so every consumer tries to maximums satisfaction with limited income. The study of economics tells how a consumer achieves equilibrium position and maximums satisfaction with limited resources.

To Producers/ Entrepreneurs
Productions process starts with the combination of four factors of production .The entrepreneurs employs the rest three factors and pays reward to their owners. His basic aims to maximize profits. Profits are the excess of total revenue over total cost. An entrepreneur can maximize his profits by diminishing cost and increasing revenue. The study of economics helps to understand how a producer or an entrepreneur can maximize his revenue and diminish cost.

To Statesmen
Knowledge of economics enables the statesmen to grasp the political problems that face him. They have to face the problems whose causes are economic e.g. Nationalization of industry, industrial and agricultural reforms, labor policy, darkness, inflation and unemployment etc. especially in the modern world, the study of economics is the key to success.

To labor leaders
Study of economics helps to understand the industrial situation. Major demand of labor leaders is to enhance wages. Business undergoes changes e.g. boom, depression. Study of economics enables the labor leader when to press his demands strongly and went to yield gracefully.

To Finance Minister
The foremost duty of finance minister is to prepare the national budget. He suggests new taxes or to increase the rates of old taxes to increase the revenue receipts. To solve the economic problems economic planning is made. An exemplary taxation system is suggested. For this purpose to knowledge of economics his indispensable.

To business
Study of economics helps to understand the principles of business organization. The businessman can plan the business well and can easily grip the production and marketing problems.

To exchange
None of the persons can produce all the necessary goods and services him. He has to depend on others. Excessive goods and services are exchanged. But to understand how exchange of goods, services and currency takes place and how prices of goods, services and currency are determined, study of economic is necessary.

For citizens
By studying economics even and ordinary citizen is able to understand the economic problems and can analyze and criticize the government policies in better way and can give his opinion which might be useful.

To economic planning /development
A country is prosperous when it is economically developed and economic planning is a tool of economic development. Without economic planning none of the country can mobilize its resources and can utilize them properly. But to understand what economic planning is and low it is beneficial we have to study economics.

To under _developed countries
An underdeveloped countries can especially benefit from economics, because he can compares his economy with the economics of developed countries and can understand tat how they had solved the problems or poverty, unemployment, adverse balance of payments and how they increase their national income, per capital income and standard of living. Study of economics helps to solve the above problems and to increase the development rate.

 

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