Importance of Economics

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The Importance of Economics The Importance of Economics When it comes to economics, it’s easy to think of it as simply how much a company, city, or nation makes or loses in regards to profits and expenses. After all, revenue is all that matters isn’t it? While revenue is an important issue that is certainly not all there is to it. There are several other things to consider about economics and exploring exactly what it is that makes it efficient is an important first step in this process. Cost is another major factor, but what else can be seen as influences in the economic world? Is it really all about supply and demand and who has the most of a resource? To obtain a better understanding of economics we must get to the core and dissect how it functions. Although many parts are important to the economic puzzle, it is efficiencies, development, growth, and financial markets that give us a better understanding of what makes economics vital and successful. Economic efficiency is an important part to economic balance. Economic efficiency can be defined as “The state of an economy in which no one can be made better off without someone being worse off” [ (Bannock, Baxter, & Davies, 2003) ]. The reason why this is so important is that it is difficult to maintain a perfect balance in economics. Think of it as a scale that has two different trays. If something is added or taken away from one side or the other, the trays may rise or fall based upon the significance of what was changed. Ideally the objective is to have both trays as level as possible without a major tilt swaying things one way or another. In a perfect world things would be close to balanced so that everyone may receive an equal portion and be able to survive financially. Sadly, this isn’t always the case. The trend lately has been very disproportional as one side is gaining massive
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