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Eco

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Essay one.

Economics is the study of human behavior as a relationship between ends and scarce means which have alternative uses. This definition is according to Robinson. While Marshall defined economics as a study of mankind in an ordinary business of life thus it inquires how he gets income and how he uses it. This definition clearly defines that economics is about studying wealth and mankind. The two definitions have various implications among them, is that human beings have needs which are unlimited and he can’t be satisfied completely. Meaning that man can continue to have wants or needs but means to satis. The other implication is that man has means of satisfying the unlimited wants using limited resources. The other implication is that man has alternative uses of scarce resources. Economics gives rise to scarcity and choice as well as opportunity cost.

Microeconomics about scarcity and choice. the term scarce means limited in supply. In this sense all things are scarce i.e. they are limited in supply. Wants are innumerable, but the resources for satisfying these wants are severely limited. From this fundamental fact arises the basic economic problem of choice. While choice between alternative courses of action is at the base of much economic activity; the house owner deciding to spend money on either repairing or repainting property. In general resources are limited, i.e are relatively scarce, and therefore, individuals must choose between competing wants. Microeconomics is thus about scarcity and choice. If all things are freely available in unlimited supply, there would be no scarcity, and no economic problems.

The term opportunity cost is used by economists to measure the real, as opposed to the monetary cost, of an economic choice; the opportunity cost of a choice is the utility which could have been earned by opting for the

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