Microeconomics - People Interaction

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How people Interact

Course Name   : Microeconomics (101MIC205_01_Spring_2015)

Submitted by   : Amira Joy Mohammadi

I.D Number     : 200007846

Submitted to    : Dr. Marwan Yousef

Submitted on   : 22/4/2015; Wednesday

Table of Content

• Introduction ……………………………………………………………………………..  3

An Introduction to the Principles of Economics

• Trade Makes Everyone Better off ………………………………………………………. 5

Example of Trade

The Growth of Trade

Why Countries Trade

My Opinion on Trade

• Markets Usually Organize Economic Activities ……………………………………….. 7

What is a Market Economy? 

History of Markets and Economies

How Markets Work

• Government Sometimes Improve Market Outcomes ………………………………….... 9

Why Governments Intervene

When Governments Had Intervened

Market Failure

• Conclusions and Suggestions ……………………………………………..…………… 11

• Bibliography …….………………………………………………………………………12

Introduction

Economics was once defined by Alfred Marshall ‘as the study of mankind in the ordinary business of life’, and this is true because economics is in every part of our lives. This world is home to occupants with unlimited wants but only has enough resources to satisfy half those wants. Earth’s resources are scarce and economists are aware of this, thus making economics the study of decisions and allocation made by people and firms. Scarcity is not limited to just resources but to money and time too.

Economists study the attitudes of millions of individuals and households to understand why they buy, what they buy and how much they save. Understandingly, a country’s economy will reflect each individuals’ behaviors in buying and saving. At the beginning of this essay I quoted Alfred Marshal on his definition and agreed that economics is in our everyday life, which it is. When a person chooses to marry, it affects the economics of the country because they need to decide if either partners work, or how many children they bring to this world; will the children be educated. Economics is often misunderstood as the study of buying and selling but in fact it is the study of decisions and allocations of resources like time, money and other things.