Q3Managerial Economics & Financial Accounting
Question
10 marks
"Economics is an art." Elaborate this statement by explaining meaning, nature and scope of Economics. (2+4+4=10)
Answer
Economics is considered an art because it applies theoretical knowledge to solve practical real-world problems.
Meaning: Economics studies how society manages its scarce resources. Nature: It is both a science (developing theories like the law of demand) and an art (applying those theories to solve practical problems like inflation or unemployment). Scope: Divided into Microeconomics (individual markets) and Macroeconomics (economy-wide aggregates). Managerial economics applies these to business decision-making.