Economics: Economics is a Science of humen behaviour concerned with the allocation of scarce means in such a manner that consumers can maximise
their satisfactions, producers can maximise their profits and the society can maximise its social welfare.
In any gathering anywhere, even a layman talks of sel interest. Ecnomics comes into picture the movment self interest is related to material benefit or welfare. If you are talking as a producer or owner of a business,
you will like to defined or promote your self interest by maximissing your satisfaction while spending your money on the purchase of different goods and services. Collective interest may also figure in your discussion. You will always desire that your country progress of develops faster than other countries in the world. You will also desire that welfare of your country men that of others in the word.
Fostering self interest in terms of material benefit or welfare involve some effort. It invloves rational management of your means or resources. This is because means are scarce in relation to you needs. As a consumers, you have limited means, you have unlimited wants. You can forest your self interest only when you spend your income on the purchase of different goods and services in a manner such that you are getting maximum possible satisfactions.
You are rationally managing your resources if you satisfaction is maximised. Like wise, a produce has limited means for the purchase of inputs for his business. His self interest is fostered when he rationally uses his inputs in the process of
production. He shall be rational in the management his resources when he maximises his business gains or profit. At the level of country as a whole also, resources are limited or scarce in relation to their need. India cannot produce or procure unlimited was aeroplane or establish an unlimited number of schools and colleges. Resources are limited, more of war aeroplanes can be produced or procused only when we decide to establish less numbers of schools and colleges. Here , rational management of resources means that resources are allocated to alternative uses in such a manner that collective interest is maximised.
Thus, it is to achieve the objective of maximisation of satisfaction at the individual level, maximisation of profit at the level of a producer, and maximisation of social welfare at the level of econmy as a whole (through rational allocation of scarce means to alternative uses). Ecnomics is subject matter that studies allocation of scarce resources to different uses in a manner such that self interest is fostered: consumer is maximising his satisfaction and producer is maximising his profits. It also studies how to collective interest or social interest is fostered through rational allocation of resources different use at the level of country as a whole.
their satisfactions, producers can maximise their profits and the society can maximise its social welfare.
You are rationally managing your resources if you satisfaction is maximised. Like wise, a produce has limited means for the purchase of inputs for his business. His self interest is fostered when he rationally uses his inputs in the process of
production. He shall be rational in the management his resources when he maximises his business gains or profit. At the level of country as a whole also, resources are limited or scarce in relation to their need. India cannot produce or procure unlimited was aeroplane or establish an unlimited number of schools and colleges. Resources are limited, more of war aeroplanes can be produced or procused only when we decide to establish less numbers of schools and colleges. Here , rational management of resources means that resources are allocated to alternative uses in such a manner that collective interest is maximised.