Economics Lessons Learned

Without any background knowledge in economics, neither business I must say it was difficult to understand the principles of economics. However, after reading and attending lectures I was able to learn and understand a great deal of economics and how it relates to the economy. I will therefore seek to explain three important lessons that I have learnt from the course. Firstly, I will define economics and its relations to real life experiences. Secondly I will look at demand and supply and last but not least I will look at unemployment and how it affects the economy. Economics is the study of how people allocate their limited resources to satisfy their unlimited wants. Economics is a part of social science and it seeks to find explanations of real life events. In order to understand the term economics, we must be aware of the concepts “wants” and “resources”. Resources are things that are used in the production process to produce goods and services that satisfy people’s wants. Wants, on the other hand, are all items that people will purchase if their income was unlimited. In economics, there are always …show more content…
Unemployment is a serious issue that affects every economy. There are four major types of unemployment, frictional, structural, cyclical and seasonal. The unemployment rate is measured by dividing the number of persons employed by the amount in the labor force. Persons who are unemployed are categories as job losers, job leavers, new entrant, reentrant and discouraged workers. The flow of persons leaving and entering the labor force will decide the stock of the employed plus the unemployed. The period of unemployment will affect the unemployment rate. If the length of unemployment increases, the amount of unemployed that was measured will increase even though the unemployment rate remains the