SOUTH EASTERN UNIVERSITY OF SRI LANKA
INDIVIDUAL PRESENTATION
 Registration
 Name
no:
with initial :
 Academic
year:
SEU/IS/20/MIT/136
A.R.Jemsith Hasan
2020/2021
CONTENTS
1.
Definition of economics
2.
Importance of economics
3.
Types of economics
4.
Difference between micro
and macro economics
5.
Needs and wants
6.
Economics resources
7.
Factors of production
1. DEFINITION OF ECONOMICS
Definition :
Economics is the field of study that examines how individuals, businesses, and
societies allocate limited resources to fulfill their unlimited desires and needs.
It involves analyzing the production, distribution, and consumption of goods and
services within an economy.
Adam Smith (1723-1790), in his book “An Inquiry into Nature and Causes of
Wealth of Nations” (1776) defines “Economics as the science of wealth”.
2. IMPORTANCE OF ECONOMICS
1.
Dealing with a shortage of raw materials.
2.
Effects of a world without oil.
3.
How to distribute resources in society.
4.
Inequality and its impact on economic incentives and social problems.
5.
Government intervention in the economy - free market vs. interventionist
perspectives.
6.
The principle of opportunity cost and its relevance in policy decisions.
7.
Social efficiency and overcoming market failures through economic solutions.
8.
Knowledge and understanding in economics
unemployment, and low economic growth.
9.
The role of economic studies in political debates and decision-making.
to
address
10. Economic forecasts and their importance in guiding decision-makers.
poverty,
3. TYPES OF ECONOMICS
A. Microeconomics
1. Definition
Microeconomics focuses on the behavior of individual economic units, such as
households, firms, and markets.
B. Macroeconomics
1. Definition
Macroeconomics takes a broader perspective by examining the economy as a
whole. It focuses on aggregate variables, such as national income, inflation,
unemployment, and economic growth.
4. DIFFERENCE BETWEEN MICRO AND MACRO
ECONOMICS
5. NEEDS AND WANTS
Needs:
Needs refer to the basic requirements necessary for survival and well-being. They
are essential for sustaining life and include necessities such as food, water, shelter,
clothing, and healthcare. Needs are universal and fundamental to human existence.
Wants:
Wants, on the other hand, are desires or preferences that are not necessary for
survival but enhance the quality of life. They are shaped by cultural, social, and
individual factors and vary from person to person. Wants can include goods,
services, experiences, and luxuries beyond what is essential for basic needs.
6. ECONOMICS RESOURCES
• Economic resources:
economic resources, also known as factors of production, are the inputs used in the production of
goods and services. These resources are scarce and have alternative uses, which necessitates their
allocation and management.
Land: this includes all natural resources such as land itself, minerals, water, forests, and other raw
materials that are used in the production process.
Labor: refers to the physical and mental efforts of individuals who contribute to the production of
goods and services. Labor includes the skills, abilities, and expertise of workers.
Capital: represents the man-made resources used in the production process, including machinery,
tools, equipment, factories, infrastructure, and technology. Capital is created by saving and
investing financial resources.
Non-economic resources:
non-economic resources, also known as free resources or non-scarce esources, are those
that are abundant and do not have a monetary value.
Examples of non-economic resources include air, sunlight, rainwater, and natural beauty.
These resources are not limited in supply and do not require economic allocation.
7. FACTORS OF PRODUCTION
A. Definition
Factors of production are the resources that are combined and utilized in
the production process to create goods and services. They are the inputs
required to produce output and satisfy human wants and needs. The main
factors of production are land, labor, capital, and entrepreneurship.
Land: Land encompasses all natural resources used in production. It includes agricultural
land, forests, water bodies, minerals, and other physical assets provided by nature.
2. Labor: Labor refers to the human effort and skills applied to produce goods and services.
It includes both physical labor, such as manual work, and intellectual labor, such as
knowledge-based and creative work.
3. Capital: Capital comprises the man-made resources used in production. It includes
physical capital, such as machinery, tools, equipment, buildings, and infrastructure, as well as
financial capital, which represents the monetary resources available for investment.
4. Entrepreneurship: Entrepreneurship involves the role of individuals who innovate, take
risks, and organize the other factors of production. Entrepreneurs identify opportunities, make
strategic decisions, and combine resources to create and manage business ventures.
Thank you