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Economics (Greek, ‘controlling a household’) is the study of the way society allocates resources for the production, distribution and consumption of goods and services. It is concerned with how societies answer the three, basic economic questions: What goods and services to produce? How to produces them? For whom in society are the goods and services to be produced?
The subject is normally divided into microeconomics and macroeconomics. In both branches, certain operating standards are pursued: theorizing, collecting and analysing facts, and then re-examining theory in the light of them. Throughout this (never-ending) process, economics is concerned to develop general propositions that can be applied in a variety of countries, periods, and circumstances and still hold good. That is why it claims to be a ‘science’, even though it is almost impossible to set up a laboratory experiment in the way that physical scientists can arrange every day. TF |
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