What are the scope of business economics?

Answer 1

Scope of Business Economics: 1. Consumer analysis focusing on demand 2. Production analysis 3. Equilibrium analysis focusing cost and revenue 4. Structure of markets and its imperfection 5. Pricing of products and services 6. Capital and profit management.

Answer 2

Scope' means the sphere of study. We have to consider what economics studies and what lies beyond it. The scope of economics will be brought out by discussing the following.

a) Subject - matter of economics.

b) Economics is a social science

c) Whether Economics is a science or an art?

d) If Economics is science, whether it is positive science or a normative science?

a) Subject - matter of economics: Economics studies how a man utilizes his limited resources for the satisfaction of his unlimited wants, a man has limited amount of money and time, but his wants are unlimited. He must so spend the money and time he has that he derives maximum satisfaction. This is the subject matter of Economics.

Neither money nor goods is an end in itself. They are needed for the satisfaction of human wants and to promote human welfare.

To fulfill the wants a man is taking efforts. Efforts lead to satisfaction. Thus wants- Efforts-Satisfaction sum up the subject matter of economics.

b) Economics is a social Science: In primitive society, the connection between wants efforts and satisfaction is close and direct. But in a modern Society things are not so simple and straight. Here man produces what he does not consume and consumes what he does not produce. When he produces more, he has to sell the excess quantity. Similarly he has to buy a product which is not produced by him. Thus the process of buying and selling which is called as Exchange comes in between wants efforts and satisfaction.

Nowadays, most of the things we need are made in factories. To make them the worker gives his labour, the land lord his land, the capitalist his capital, while the businessman organizes the work of all these. They all get reward as money. The laborer earns wages, the landlord gets rent the capitalist earns interest, while the entrepreneur's (Businessman) reward is profit. Economics studies how these income-wages, rent interest and profits-are determined. This process in called "Distribution: This also comes in between efforts and satisfaction.

Thus we can say that the subject-matter of Economics is

1. Consumption- the satisfaction of wants.

2. Production- i.e. producing things, making an effort to satisfy our wants

3. Exchange- its mechanism, money, credit, banking etc.

4. Distribution - sharing of all that is produced in the country. In addition, Economics also studies "Public Finance"

c) Economics, a Science or an Art? Broadly different subjects can be classified as science subjects and Arts subjects, Science subjects groups includes physics, Chemistry, Biology etc while Arts group includes History, civics, sociology Languages etc. Whether Economics is a science or an art? Let us first understand what is terms 'science' and 'arts' really means.

A science is a systematized body of knowledge. A branch of knowledge becomes systematized when relevant facts hove been collected and analyzed in a manner that we can trace the effects back to their and project cases forward to their effects. In other words laws have been discovered explaining facts, it becomes a science, In Economics also many laws and principles have been discovered and hence it is treated as a science. An art lays down formulae to guide people who want to achieve a certain aim. In this angle also Economics guides the people to achieve aims, e.g. aim like removal poverty, more production etc. Thus Economics is an art also. In short Economics is both science as well as art also.

d) Economics whether positive or normative science: A positive science explains ''why" and "wherefore" of things. i.e. causes and effects and normative science on the other hand rightness or wrongness of the things. In view of this, Economics is both a positive and. normative science. It not only tells us why certain things happen, it also says whether it is right or wrong the thing to happen. For example, in the world few people are very rich while the masses are very poor. Economics should and can explain not only the causes of this unequal distribution of wealth, but it should also say whether this is good or bad. It might well say that wealth ought to be fairly distributed. Further it should suggest the methods of doing it.

Answer 3

The scope of Welfare Economics included:

1) economic and non-economics welfare

2)Positive and normative study explain

3) Individual welfare and social welfare