Nature And Scope Of Economics — Flashcards

Answer

The central problem of economics is scarcity — unlimited human wants versus limited resources. Because resources are scarce and have alternative uses, individuals and societies must make choices about…

Answer

Adam Smith defined economics as 'a science which inquires into the nature and causes of the wealth of nations.' He focused on the production and growth of wealth, emphasizing how nations use natural r…

Answer

The main features are: (1) It focuses only on material goods; (2) It emphasizes the creation and growth of wealth; (3) It treats economics as a study of wealth, placing humans in a secondary role. Thi…

Answer

Alfred Marshall defined economics as '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…

Answer

Marshall’s definition improved by placing human welfare at the center rather than just wealth. It recognized that economics is not just about money but about improving material wellbeing. However, it …

Answer

Robbins defined economics as 'the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses.' This definition highlights choice under scarcity a…

Answer

Robbins introduced three key ideas: (1) Unlimited ends (wants), (2) Scarce means (resources), and (3) Alternative uses of resources. His definition made economics a positive science focused on human b…

Answer

The main criticism is that it ignores important macroeconomic issues like unemployment, inflation, economic growth, and development. It treats economics only as a science of scarcity and does not acco…