Basic Concepts of Economics

Published by Boni on February 3, 2022February 3, 2022

Most people remain uninformed about the basic economic concepts despite being affected daily by financial and economic issues. Whether it is a big business or a small business, large family or a small family, one should plan his expenditure at the beginning and end of a month or year. This is the only way to balance between scarce resources and unlimited requirements.

While some economics topics may appear confusing, it is essential to know some basic terms and facts. Just as many students seek help from online economics homework help, Gudwriter offers the best you Economic HW service that will help you understand the fundamental economic concepts.

The main two categories of economics are;

• Macroeconomics. Macro means large. Macroeconomics studies issues related to large economic units. It deals with topics like government spending, National Economic Growth, unemployment or inflation.
• Microeconomics. Micro means small. Microeconomics studies small units like personal decision-making, labor markets or household activities.

The Main Basic Economic Concepts

• Supply and Demand

Supply and demand affect you in every aspect of your daily life. From the bread you buy in a supermarket to car fuel in the gas station. Numerous forces affect the demand and supply of goods and services. The theory states that both the consumer and the producer will match up at a certain price point. It is the point where the seller and the buyer agree to exchange the good or service.

Some factors that may affect demand and supply are advances in technology, surpluses or shortages in both international and domestic markets. For example, if a country is experiencing drought today, as a consumer, you will understand that the price of food will rise in the future. 

• Scarcity

Scarcity, demand and supply are all related. Generally, resources are scarce while human needs are unlimited, creating an economic problem called scarcity. For example, you may be willing to buy three pairs of trousers, but your money is only enough for one pair. Money, time and natural resources are examples of scarce resources.

Seek Economics assignment help from our qualified tutors to understand this vital concept. Scarcity arises when the good or service supplied doesn’t meet the demand.

• Opportunity Cost

This concept is known as the exchange policy. You must give out a product, money or whatever to acquire something you need. For example, as you produce more of any good since the resources are scarce, you must forgo the production of another product.

There is a consequence for everything that you choose to do. If you decide to skip a lecture and sleep, you will lose the tuition fee you paid for that class. There is so much you learn about opportunity cost from the economics essay writing service at Gudwriter.

• Time Value of Money

The time value of money concept states that a shilling today is worth more than a shilling tomorrow. The stock market is an excellent example of the time value of money. The prices of a particular stock may decrease or increase due to inflation. This concept factors inflation, a generalized increase in the price level over a given time period.

It encourages investing a shilling today rather than waiting tomorrow when the returns may be tiny. If you want to manage your money effectively, you should explore this concept by seeking economics homework from Gudwriter and guarantee yourself an A+ in your economic HW.

• Purchasing Power

Purchasing power is the amount of good or service money can buy for you. The amount of goods one thousand Kenyan shillings could buy for you five years ago is more than what you can buy today with the same amount. An increase in inflation lowers the purchasing power. In other terms, it may be referred to as the money value.

Understanding the study of economics is very important. In day-to-day life, these concepts will influence your decision-making in one way or the other. They are vital in balancing your limited resources with unlimited requirements.

We understand that Most students are puzzled by economics assignments and find it hard to complete them. If you decide to dedicate your time to craft a quality economics paper ensure you first take note of the issues that make most students fail while handling economic papers.

Economics Questions With Answers

1. Which of the following payment types require you to pay upfront?
2. All of the following components are commonly found in rental housing agreements except:
3. In a free-enterprise system, consumers decide?
4. Which of the following is not a cost typically associated with owning a car?
5. Which of the following types of financial aid do not require you to pay the money back?
6. What is one benefit of purchasing saving bonds?
7. Which of the following is a unique feature of credit unions?
8. Which helps enable an oligopoly to form within a market?
9. All of the following make up the big three credit reporting agencies except:
10. Which statement is not true regarding a straight life policy?
11. Which of the following is an example of derived demand?

Special offer! Get 20% discount on your first order. Promo code: SAVE20