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Importance of Economics: A PPT by Aviral Gupta

Economics studies how scarce resources are allocated through supply and demand. It examines this at both the micro level of individual actors and the macro level of overall economic conditions and aggregates. Statistics play an important role in economics by simplifying complex data, enabling comparison, informing policy decisions, and allowing for forecasting and testing of economic theories. Statistics are also crucial across many fields like business, banking, government administration, and science.

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757 views16 pages

Importance of Economics: A PPT by Aviral Gupta

Economics studies how scarce resources are allocated through supply and demand. It examines this at both the micro level of individual actors and the macro level of overall economic conditions and aggregates. Statistics play an important role in economics by simplifying complex data, enabling comparison, informing policy decisions, and allowing for forecasting and testing of economic theories. Statistics are also crucial across many fields like business, banking, government administration, and science.

Uploaded by

abhikini93
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© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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IMPORTANCE OF ECONOMICS

A PPT BY AVIRAL GUPTA

The study of how the forces of supply and demand allocate scarce resources. Subdivided into microeconomics, which examines the behavior of firms, consumers and the role of government; and macroeconomics, which looks at inflation, unemployment, industrial production, and the role of government.

Why is Economics important ?


Economics deals with the laws and principles which govern the functioning of an economy and its various parts. An economy exists because of two basic facts. Firstly, human wants for goods and services are unlimited and secondly, productive resources with which to produce goods and services are scarce. Therefore, an economy has to decide how to use its scarce resources to obtain the maximum possible satisfaction of the members of the society. It is this basic problem of scarcity which gives rise to many of the economic problems

The subject matter of economics has been divided into two parts: microeconomics and macroeconomics. In Microeconomics we study the economic behavior of an individual, firm or industry in the national economy. It is thus a study of a particular unit rather than all the units combined. We mainly study the following in microeconomics: 1) Product pricing 2) Consumer behavior 3) Factor pricing 4) Economic conditions of a section of the people 5) Study of a firm and 6) Location of a industry

In macro economics, we study the economic behavior of the large aggregates such as the overall conditions of the economy such as total production, total consumption, total saving and total investment in it. It includes:
1)National income and output 2) General price level 3) Balance of trade and payments 4) External value of money 5) Saving and investment and 6) Employment and economic growth.

Importance of Statistics
Statistics play an important role in economics. Economics largely depends upon statistics. National income accounts are multipurpose indicators for the economists and administrators. Statistical methods are used for preparation of these accounts. In economics research statistical methods are used for collecting and analysis the data and testing hypothesis. The relationship between supply and demands is studies by statistical methods, the imports and exports, the inflation rate, the per capita income are the problems which require good knowledge of statistics

Stats simplifies complex data : it helps in presenting a mass of data in a manner such that it becomes easy to understand. Provides techniques of comparison : statistical tools like average , ratio , percentage etc are useful in comparison. Help in formation of policies : many policies such as import , export , wages and production are formed on the basis of stats. Help in forecasting : stats help in predicting future phenomenon such as market situation for the future is predicted on the basis of the available stats of both present and past. Helps to test and formulate theories : When some theory is to be tested , statistical data and techniques are useful.

Statistics play an important role in business. A successful businessman must be very quick and accurate in decision making. He knows that what his customers wants, he should therefore, know what to produce and sell and in what quantities. Statistics helps businessman to plan production according to the taste of the costumers, the quality of the products can also be checked more efficiently by using statistical methods. So all the activities of the businessman based on statistical information. He can make correct decision about the location of business, marketing of the products, etc

Stats and Mathematics


Statistical plays a central role in almost all natural and social sciences. The methods of natural sciences are most reliable but conclusions draw from them are only probable, because they are based on incomplete evidence. Statistical helps in describing these measurements more precisely. Statistics is branch of applied mathematics. The large number of statistical methods like probability averages, dispersions, estimation etc is used in mathematics and different techniques of pure mathematics like integration, differentiation and algebra are used in statistics

Stats and Banking


Statistics play an important role in banking. The banks make use of statistics for a number of purposes. The banks work on the principle that all the people who deposit their money with the banks do not withdraw it at the same time. The bank earns profits out of these deposits by lending to others on interest. The bankers use statistical approaches based on probability to estimate the numbers of depositors and their claims for a certain day.

Stats and State Management


Statistics is essential for a country. Different policies of the government are based on statistics. Statistical data are now widely used in taking all administrative decisions. Suppose if the government wants to revise the pay scales of employees in view of an increase in the living cost, statistical methods will be used to determine the rise in the cost of living. Preparation of federal and provincial government budgets mainly depends upon statistics because it helps in estimating the expected expenditures and revenue from different sources. So statistics are the eyes of administration of the state.

Stats and Astronomy


Astronomy is one of the oldest branch of statistical study, it deals with the measurement of distance, sizes, masses and densities of heavenly bodies by means of observations. During these measurements errors are unavoidable so most probable measurements are founded by using statistical methods. Example: This distance of moon from the earth is measured. Since old days the astronomers have been statistical methods like method of least squares for finding the movements of stars

CONCLUSION
Thus , Statistics plays a vital role in every fields of human activity. Statistics has important role in determining the existing position of per capita income, unemployment, population growth rate, housing, schooling medical facilities etcin a country. Now statistics holds a central position in almost every field like Industry, Commerce, Trade, Physics, Chemistry, Economics, Mathematics, Biology, Botany, Psychology, Astronomy etc, so application of statistics is very wide. Statistics provide detailed information about situations. Health statistics help researchers learn what treatments work well or not. Numbers don't lie. Statistics is an important part of life. They allow us to analyze information on a very basic level. Statistics help us understand the world around us and the frequency that things happen

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