Overview

Economics is the study of the production, distribution, and consumption of goods and services.

The key factor that drives economies is scarcity. Scarcity occurs when the human desire is endless but supply is limited.

Whether or not the individual is a consumer, firm, or government, they would want to minimize input price and maximize output price.

Macroeconomics

Macroeconomics focuses on the performance of economies – changes in economic output, inflation, interest and foreign exchange rates, and the balance of payments.

Macroeconomics is a wider view of the economy.

Microeconomics

Microeconomics is the field of economics that looks at the economic behaviors of individuals, households, and companies.

Types of Economies

There are mainly three types of economies.

1. Traditional
2. Command - The government controls supply and price
3. Market - The demand and supply controls the price

Types of Markets

Labor Market

Labor markets refer to the supply of and demand for labor.