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CBSE Notes for class 11 th

 

Introduction : introduction to micro economics Micro Economics class 11th:English Medium NCERT Book Solutions

NCERT Books Subjects for class 11th Hindi Medium

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Introduction

 

introduction to micro economics

 

Chapter - 1.

Nature and scope of economics.

Economy -

An economy is a system which helps to produce goods and services and enables people to earn their living.

Economic as a positive or normative science :

  • ''Economics is a science and economics is positive science mean the same thing''
  • ''Economics as an art and normative economics means two related but different things"
(a) Positive Economics:
  • It shows Cause and effect relationshisp,
  • It investigates "what is", "what was", "what will"
  • It dose not pass value judgements.
  • It is not concerned with welfare propositions.
  • This approach of economics.was propunded by lione robbins.
(b) Normative Economics:
  • Normative is derived from the word "norm" or ''standerd'' which implies  ''what ought to be".
  • It passes value judgements.
  • It is concerned with welfare propositions.
  • It decides standars which should be adhered to in achieving economic objectives.
  • This approach was propounded by alferd marshall.

herce, economics is both a positive and normative Sciennce

Scope of Economics:

(i) Micro Economics -
  • It studies the economics issues of an individual unit like an individual consumer, producer or a firm. 
  • In other words, it studies the berhaviour of individual economic units.
  • In this we use " bit by bit " approdach which means breaking a big problem into small parts and then study one bit at a time.
  • It deals with the problem of alloction of resources.
  • it is also known as the "price theory".
  • some of the components of micro economics are:

1. theory of consumer behavior.

2. theory of production.

3. theory of product pricing.

(ii) Macro Economics:
  • It studies the economic issues at a level of an economy as a whole.
  • Under this variables are aggregat and relate to large groups of economic units.
  • In other words, it studies economic units.
  • Macro economics is also known as "income theory" or "aggregative economics"
  • Some components of macro economics are:

1. National income.

2. Labour force and population.

3. Unemployment.

4. Balance of payment.

Economic Problem -

It is a problem of selection of scarce resources for satisfying unlimited human wants.

Causes of Economic Problem -

  • Resources are limited,
  • Human wants are unlimited, and
  • alternative uses of resources.    

 

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