The objective of this paper is to provide answers to the following questions: 1. What is Economics? 2. What do you expect from this class? 3. Provide an example of economic forces at work. Does this issue affect individual consumers or firms or the economy as a whole? And 4. Which economics principles govern the situation you described?
1. What is Economics?
There are various definitions of economics due to the diverse perspectives of the authors who delved into this field of study. In a research conducted by Melberg (1998) on the definitions of economics, he quoted Alfred Marshall’s definition: "Economics is a study of mankind in the ordinary business of life. it examines that part of individual and social action which is most closely connected with the attainment and with the use of the material requisites of wellbeing" (cited in Hirschleifer 1985, 53. Originally in Alfred Marshall (1920, 1). Webster Dictionary (2007, 97) defines economics: "a social science concerned chiefly with description and analysis of the production, distribution, and consumption of goods and services."
2. What do you expect from this class?
As a student of an economics class, I expect to learn about the basic theories, concepts, and practical applications of economics to people, business entities, local and government institutions and to the world, as a whole. I expect to be given a framework which would explain the concepts of economics in a simple manner so as to make understanding and awareness of the relevant theories easy to grasp. I expect to apply whatever I learned from this class in future interactions with organizations and economic entities with efficiency and effectiveness.
3. Provide an example of economic forces at work. I think a common example of economic forces at work is the law of supply and demand.
A simple example would be: if a demand for a certain product (cellphones) are great, and the supply is small, the price for the product tends to increase. But when the demand is small, and the supply is great, the price for that product tends to decrease.
Does this issue affect individual consumers or firms or the economy as a whole?
The law of supply and demand in microeconomics takes into consideration economic decisions of individuals, households and business enterprises in specifically defined markets.
4. Which economics principles govern the situation you described?
The law of supply and demand is governed by the principles of microeconomics. Mofatt (2009) defines microeconomics from The Economist’s Dictionary of Economics as "the study of economics at the level of individual consumers, groups of consumers, or firms… The general concern of microeconomics is the efficient allocation of scarce resources between alternative uses but more specifically it involves the determination of price through the optimizing behavior of economic agents, with consumers maximizing utility and firms maximizing profit." The main factor that influences the law of supply and demand is the price of the product or service in consideration. However, there are other factors which have to be considered when evaluating this economic force at work.
An efficient buyer or seller should always be vigilant on which specific forces are actively affecting the demand and supply of goods to assist him in his decision making. In these times of financial crisis, the prices of commodities are relevant considerations before actual purchase. Knowledge of this law in microeconomics provides a timely guide to assist decision makers in making simple but efficient transactions.
Melberg, H.O. (1998). Definitions of economics: A short and uncritical introduction.
Retrieved on July 3, 2009 from  .
Mofatt, M. (2009). What is Microeconomics? About.com. Retrieved on July 3, 2009,