“Economics brings into view that conflict of choice is one of the permanent characteristics of human existence”. - Lionel Robbins

The world has limited resources only and human desires have unlimited wants and needs probably never-ending. Whether we realize it or not economics is there in our daily life. While making buying decisions we are making use of economics. In the everyday world, we are pushed into our daily lives to make economic decisions. Economics teaches us many things, such as how to make limited decisions, how the aggregate economy functions, how to communicate with society, how to analyze important events

Economics is the study of why Pankaj has a car and Naveen has a bicycle only. The study of economics is not about curves, models but a very broad one and mainly focusses into four factors of production such as Land, labour, capital, and enterprise. Besides, is further divided into two major fields’ microeconomics and macroeconomics. It emphasizes how individuals, groups, and nations manage, use, produce and distribute goods and services.

It is crucial to understand economics in a global world. Almost all problem the world is facing right now is somewhere linked with economics starting from China- USA dispute, poverty, global warming, terrorism, etc. The world is a global village now and everything is interconnected, it is important to understand businesses, markets, and governments so that we should be in a better position to respond to the threats and opportunities that may emerge due to changing situations.

You might well ask, what is this GDP, inflation rate, CPI, WPI? What is the purpose of measuring, analyzing, and calculating? Economics is the study of patterns. Most of the economic theories or model is based on observations made in the real world. The ultimate goal of government is to improve the living conditions of people, whether people act rationally or irrationally. Economic discipline mainly has two essential features. First, economists develop mathematical behavioural models to forecast reactions to policy and market shifts. Secondly, to analyze such events, they conduct statistical analysis. Ironically, almost all economic theories have originated from the political economy. For instance, The Great Depression crisis of the 1930s caused a fertile era in the economic theory of scientific temperament and revolution. Keynesian school economics model proposed that underdevelopment issues can be solved by expanding government activities. Early economists such as Physiocrats were counsellors to their period rulers.

Economics can be useful for all, not just in businesses. The prices of the goods and services are interconnected, how “price system or market mechanism moves together, and how buyers and sellers are brought together in a market. If we can analyze, interpreted, humans their wants and desires we can design initiatives that can have social, economic, political impacts at all levels (local, national). For instance, China was able to lift around 200 million people out of property followed by a series of economic policies in the 1980s.

Common Misconceptions about economics

· A high level of mathematical and statistical tools is required to understand the economics 

Studying of high-level economics requires only statistical tools. Simple mathematics can be applied to understand concepts like GDP, CPI, and WPI, etc. the analytical tools and frameworks are just used to understand human behaviour in the areas of getting and spending money or supply and demand. 

 · ECONOMICS is only important for the business-minded or moneymaker and no relevance for common people 

The study of economics provides insight into making decisions in everyday life. It can be used as a tool, which tells about the desirability of opportunity. For example whether or not to go for an MBA degree the benefits and costs of alternative careers etc. At the organizational level When you understand these terms, theories, and frameworks like Porter’s Five Forces and SWOT. You can analyze the situation and make a variety of economic decisions for your organization based on these tools for analysis. 

 · Economics is only about business and government policies, budgets, etc. 

Economics is the study of areas of human behaviour. Obviously, some of the aspects of economics are business behaviour and government policies. Economists have done fantastic work on issues like health, social, political, etc. For example- obesity, divorce, poverty. Money supply, effective credit system, efficient functioning of the banking system can only be accomplished in the country if the people who manage these sectors having a comprehensive knowledge of economics. Thus, it becomes very important for a finance minister to understand and formulate the budget for development and social well-being.

• Economics is a better tool to measure happiness

Happiness is a subjective measurement. An economic metric such as GDP has little to say about society's degree of inequality. GDP covers what is spent on things like health care and education, but does not include real standards of environmental cleanliness, health level, and work-life balance. As people still feel relatively poor and unequal, even increasing GDP per capita does not lead to increased satisfaction. Whether happiness is due to high GDP or other features of high-income countries becomes difficult to understand.

• Studying economics has no career prospects

The study of economics is a broad field that has better career opportunities and is well paid for their services. Some of the career options are Statistician, Stockbroker, Economist, Data analyst, Market research analyst, and Economic consultant.

• Poverty, unemployment, etc cannot be eliminated with the help of the study of economics

Poverty today and the poor living conditions of the people of many developing countries are due to inadequate capital, low productivity, and lack of technology. Economic awareness is essential for eradicating a nation's poverty and raising its standard of living. The gap between human wants and insufficient resources can be reduced through proper economic research.

• The study of Economics does not have any relation with the formation of law

Economics awareness is very important for policymakers and parliamentarians alike. They would only be able to frame laws effectively by providing subject matter expertise. Economics isn't a bundle of concepts and ideas. It is a hands-on social science. The study of the subject is not carried out purely for the sake of knowledge. It is done to lay down values and strategies for poverty eradication and improved human well-being.

• Excessive intervention by the government is good for the economy

Free market economists like Friedman argue that government interference should be strictly limited because government intervention tends to trigger inefficient resource allocation. Economists, like Krugman, argue that government action can address inequality and public goods under-supply. Keynesian economists argue that government through monetary policy will positively affect the economy. Monetarists believe monetary policy may help promote economic stability through an autonomous central bank.

• Economic forecasts are reliable

Forecasts are made on assumptions only and there is no guarantee that these assumptions will be right and give accurate results. Economic prediction is difficult and also depends on the reliability of data. Properly used and recognized forecasts would contribute to better business decisions than overlooked forecasts. Economies are complex typically, forecasters estimate short term trajectories with fair precision. For example, Paul Krugman In 2016 he wrote in the New York Times “stock markets across the world, which at the time were slumping, would "never" recover since The Dow Jones industrial average has risen.

Conclusion

No one has ever succeeded in clearly defining the scope of economics. 

Economics offers a context for interpreting government strategies, trends in industry and consumer behaviour, etc. It provides a method for making corporate, technical, and financial decisions. The more you know about these businesses environment, the better as a boss, consultant, and decision-maker you can work as.

Because of the scarcity of resources, and the need for productivity, economics is an important topic to understand. Most of the economic theories are based on assumptions about how people act rationally, but when those assumptions collapse, it is necessary to know what to do in such circumstances and why these assumptions have failed. Studying cognitive biases that affect our economic decision-making processes arms you with the tools to predict human behaviour in the real world.

Strong economics can be a source of optimism – a way of recognizing events that went wrong but also of describing how our world can be put together again.