Portfolio on Economics - What Is Economics?

1. What is Economics?

From what I learned, Economics is the study of how people use their resources to satisfy their needs. Economics also includes studying about population, population densities, graphs, charts, and economic growth of the country through the years, stock prices, and many more.

Economics includes these four questions: What to produce, how to produce, how much to produce, and for whom to produce.

What to produce? Producers, like businessmen and entrepreneurs, ask this question to know what to make to satisfy the needs and demands of the consumers. For example, if there was a natural disaster like typhoons or floods, producers will make more instant noodles, canned goods, and bottled water because it is one of the foremost necessities that people will need.

How to produce? Producers must bear in mind that if they are to make products, it must not be harmful to any living creature or that the resources they will be using, may it be renewable or non-renewable, will not be depleted in the long run, and the process they will use must be nature-friendly. The components of their products must also be beneficial and safe to use by its consumers.

How much to produce? This is an important query because the producers must know how much to make to avoid spoilage and waste of valuable resources. They must estimate correctly because if consumers demand more than their production, they waste more money in doing the process all over again intead of just doing it in a single time. If the produce is more than the demand, then many products will be left unconsumed.

For whom to produce? Producers should also think about their customers. They must consider who are going to buy their products and who might be interested to buy so that they know how to target those customers to buy their products.

2. Microeconomics

Microeconomics is one of the branches of economics that studies the behavior of how the individual contemporary household and firms make decisions to distribute limited resources. It also relates to markets where goods or services are being bought and sold. It observes how these decisions and behaviors affect the supply and demand for goods and services, which controls prices, and how prices, in turn, determine the quantity supplied and quantity demanded of goods and services by the consumers.

3. Macroeconomics

Macroeconomics is another branch of economics that deals with the performance, structure, behavior, and decision-making of the entire economy. This involves a national, regional, or global economy. It is the opposite of Microeconomics. Macroeconomists study summarized indicators such as GDP, unemployment rates, and price indices to understand how the whole economy functions. It also studies about the relationship between such factors as national income,