Getting Started

So that was actually about the Indian economy, but did you think

- What actually is economics?
- How did this economics come into this world?
- Who gave this name "economics"?
- Why do we need economics?

Well, we'll understand this today, and don't worry; this isn't only about this stuff; we've more topics today...

So let's get started.

What is an Economy?

- Economics = Study
- Economy = System

Okay, for example:

Now imagine a country where millions of people are:

- Working
- Farming
- Manufacturing
- Buying
- Selling
- Paying Taxes

This entire system is called the **economy.**

Like in your house:

Your father goes to work and earns money
Your mother buys groceries
Your grandfather grows vegetables in the village.
Your sister sells handmade bracelets online.
You... well... you're reading this article instead of studying. 😶
And at the end everyone is paying taxes on everything ...
Everyone is producing, buying, selling, or earning something (except you).

What is Economics?

Suppose I gave you ₹50,000 (in your dreams only), and you have so many things on your bucket list, like:
- buying a PC,
- Laptop,
- iPhone,
- Eating in a 5-star restaurant,
- Going on trip with your girlfriend (Do you even have that?)

So you'll have to set your priorities. Which thing can you afford, and what is more important to you? isn't it?
For example:
But here is the problem! You can't buy everything simply in this budget.
So you compare your options, set priorities, and choose what matters most to you.

Yep, that's it.

Okay, here is an example for both economy and economics...

The economy is like a cricket match. 🏏
Economics is the person (Dream11) sitting with a notebook trying to explain why the team lost. 😂

Well, now we'll understand:

Origin of the Word Economics

If you are like me, then you would be like, 'Bruh, why the hell should I know who did that or started that?' I don't care.
I don't even remember my great-great-grandfather's name, so who cares about that dude?

But let's, for the sake of mankind, please let us know about that at least because if you have any examination to give, this education system has no work except eating our innocent brains. Let's know about that.

**Who woke up one day after breaking up with his bestie and said, "Let's call this subject Economics?"
**"Thukra ke mera pyaar, mera inteqaam dekhegi."**

Just kidding, guys.

The word **"Economics"** Comes from the Greek word **"oikonomia".**

Technologiaaaaaaaa <br/>

Well, let's break this weird-looking word into two parts...

- Oikos = House or household
- Nomos = Management Or Rule

So,

Oikonomia = Household Management

Wait,,,

A Subject that talks about inflation, GDP, unemployment, taxes, and international trade started with.. **managing a house? 😭**

Yupp

Think of it.
Imagine your parents run your home.

Every month they have to decide:

- How much money should be spent on groceries?
- Should they buy a new TV or repair the old one?
- How much should they save for emergencies?
- How much should they invest in their daughter and waste on their dog?
- Can they afford a family trip this month?

If they spend everything on pizza...

Congratulations...

Next month everyone will eat air sandwiches. 🥲

Managing a house requires making smart decisions with limited money.

Now imagine doing the same thing for an entire country instead of one house.

That's where economy comes in.

So, although the word originally meant **"household management",** today economics is much broader/wider.

It studies how individuals, businesses, and governments use limited resources to satisfy unlimited wants.

Quick exam points:

Why Do We Need Economics?

Alright...

Imagine tomorrow you woke up and suddenly **economics disappeared from the world.

"Who cares? We never liked economy anyway."

Wait...

Let's see what happens.

Suppose you receive your monthly salary of 30,000 rupees.

Without economics, you think:

₹12,000 on a brand-new phone. 📱
₹10,000 on food delivery because cooking is too much work. 🍕
₹6,000 on online shopping. 🛒
₹5,000 on a weekend trip. ✈️

Congratulations!

You've successfully spent ₹33,000 even though you only had ₹30,000. 👏😂

Now it's the 20th of the month

Your wallet/ UPI says:
"Maalik/Owner.. We are cooked 💀."

Economics teaches us to make smart decisions before making expensive mistakes.

🧠 ## Quick Exam Point

We need economics because it helps us:

Use limited resources wisely.
Make better financial decisions.
Solve economic problems like unemployment and inflation.
Improve the standard of living.
Help governments plan the country's development.

Human Wants

Before I explain what **human wants** are...

Let me ask you a question.

Right now.

What do you want?

Not that stuff; I mean, like, of course.

- 🍕 Pizza
- 📱 A new iPhone
- 💻 A gaming PC
- 🏍️ A bike
- 💸 Lots of money
- A girlfriend or boyfriend
- 😴 Or maybe just 8 hours of sleep...

You immediately started thinking about something you don't have.

That's called **'want'.**

not talking about your desires. Those are different; we are talking about wants, okay?

But here is a funny part...

As soon as one wants something fulfilled...
A new one appears

For example,
Right now when you wanted a *ukulele*, as soon as you got one...

Now you wanted a piano.

After that maybe you want **a guitar** now!

Then...

Congratulations! You're now 60 years old and still making a wishlist. 😂

That's why economists say the following:

Human wants are unlimited.

Because we humans are most evil in the universe...

It doesn't matter how much we get; we always make desires instead of needs...

Well, I hope I don't need to explain the difference between needs and desires.

🧠 Quick Exam Point

Human wants are the desires or wishes of people to possess and use goods and services that give them satisfaction.

Characteristics of Human Wants
✅ They are unlimited.
✅ They keep changing with time.
✅ One want gives birth to another want.
✅ Different people have different wants.
✅ Some wants are more important than others.

Resources

Let's talk about resources...
Imagine I gave you a challenge.

"Cook something delicious for me, like a 5-star."

Easy, right?

Wait...

Where is the money?

Where are the things to cook?

Where to cook?

Where is the gas stuff?

Oops...

Looks like you can't cook without any of these?

These are called **'resources'.

In simple words...

Resources are anything that helps us produce goods or satisfy our wants.

For example:

- 💰 Money is a resource.
- 👨‍🌾 Farmers are resources because they produce food.
- 🌾 Land is a resource because crops grow on it.
- 🏭 Machines are resources because they help make products.
- ⛽ Fuel is a resource because it powers vehicles and factories.
- 🧠 Knowledge and skills are also resources because they help people solve problems and create things.

Without resources...

Nothing gets done.

No food.

No houses.

No smartphones.

No internet.

No memes (Hamba Hamba, Ramba Ramba, Kamba Kamba).

Basically... we evils would press the Game Over button. 😂

.

🧠 ## Quick Exam Point

Resources are the things that help us produce goods and services or satisfy human wants.

Types of Resources (Easy to Remember)

Scarcity

Let's play a game

Imagine you are extremely hungry. 🍕🤤

I put one **delicious pizza in** front of you.

Just when you are about to eat it...

Your three best friends arrive.

Now there are **four hungry people.**

But only **1 Pizza**

Uh-oh...

Now what?

- Share it?
- Fight for it?
- Order another one (assume that restaurant got closed.. hehehhe)

The problem isn't that pizza doesn't exist.

The problem is that there isn't enough pizza for everyone.

That's called 'scarcity'.

Scarcity means having limited resources to satisfy unlimited human wants.

In other words...

There isn't enough of everything for everyone.

Scarcity is everywhere!

Think about it:

- 💰 Your pocket money is limited.
- ⏰ You only have 24 hours in a day.
- 📱 Your phone battery eventually dies.
- 🌍 Land on Earth is limited.
- 🛢️ Petrol and minerals are limited.
- ❤️ True love is limited (hehe, Hurry up)

You want:

- A better phone.
- Faster internet.
- More money.
- More holidays.
- More sleep.
- And probably another pizza. 🍕😆

🧠 ## Quick Exam Point

Scarcity is the situation in which human wants are unlimited, but the resources available to satisfy those wants are limited.

Easy Formula to Remember

Unlimited Wants + Limited Resources = Scarcity

Now you understand why economics was born.

If everything were unlimited...

- Unlimited money 💰
- Unlimited food 🍕
- Unlimited houses 🏠
- Unlimited time ⏰

Would anyone need economics?

Nope.

Because there would be nothing to choose between.

Economics exists because scarcity exists.

So this is about part 1 of it...

I'll post part 2 very soon and study ...

- Choice
↓
- Allocation of Resources
↓
- Robbins' Definition
↓
- Samuelson's Definition
↓
- Positive vs Normative Economics
↓
- Microeconomics
↓
- Macroeconomics
↓
- Relationship Between Micro & Macro
↓
- Differences
↓
- Significance
↓
- Exam Questions