Meaning of Economy {Indian Economy}

 

The economies involve all production and consumption-related activities as will as the trade of goods and services in a country. an economy is often synonym of the economy system therefore its includes the distribution of resources to the factor of production as will the labor and capital required for the production factor to produce an output.

also based on the openness of an economy it is classified as an open economy or a planned economy were the government has a entire control of the factors of production and how they will be allocated like for example in the ex -communist countries.

Economics is a social science concerned with the production distribution  and consumption of goods and services it studies how individual business government and nations make choice on allocating resources to satisfy their wants and need trying to determine how these groups should organize and coordinate efforts to achieve maximum output.

Economics can generally be broken down into macroeconomics which concentrates on the aggregate economy and microeconomics which focuses on individual consumers and business .

There are also schools or economics thought two the most common are monetarists have generally favorable views on free markets as the best way to allocate  resources and argue that stable monetary policy is best course for managing the economy in contrast the Keynesian approach believes that markets  often don't work well at allocating resources on their own favors fiscal policy by an activity government in order to manage irrational market swings at recessions.

economic analysis often progress through deductive process including mathematical logic where the   implementation of specific human activity are considered in a means ends framework some branches of economic thought emphasize empiricism rather then formal  logic where the implications of specific human activity are considered in a means ends framework some branches of economic thought emphasize empiricism rather than formal logic specifically for macroeconomics which attempt to use the procedural observations and falsifiable tests associated with the natural science

science true experiment cannot created in economics empirical .economists rely on simplifying assumptions and retroactive `data analysis however some economists argue economics is not well suited to empirical testing and such methods often generate incorrect or inconsistent answers. 

TYPE OF ECONOMICS

Microeconomics     focuses on how individual costumer and firm make decisions these individuals can be single person a house hold a business organization or a government agency analyzing certain aspect of human behavior microeconomics tries to explain they respond to change in price and why they demand what they do at particular price levels microeconomics tries to explain how and why difference goods are valued differently how individual make financial decisions and how how individual best trade individual coordinate and cooperate with one another microeconomics topics ranges from the dynamic of supply and demand to the efficiency and costs associated with producing goods and services they also include how labor is divided and allocated uncertainty risk and strategic game theory.

Macroeconomics studies an overall economy on both a national and international level its focus can include a distinct geographical region a country a continent or even the whole world topics studied includes foreign trade government fiscal and monetary policy unemployment rats the level of inflation of interest rates a growths a total production output as reflected by changes in the growth domestic product (G.D.P) and business cycles that result in extension booms recession and depression. 

Economic Indicators 

Economic indicators are report that detail a country economics performance in a specific area. these reports are usually published periodically by government agencies or private organization and they often have a consideration effect on stock fixed-income and forex markets when they are released. they can also be very useful for investors to judge how economic conditions will move markets and the guide investment decision.

Gross Domestic Product (GDP)

The gross domestic product (GDP) considered by many to be the broadest measure of a country's economic performance it represents the total market value of all finished goods and services produced in a country in a given year or another period (the bureau of economic analysis issues a regular report during the later part of each month). Many Investors  analyst and traders don't actually focus on he final annual GDP report but rather two report issued a few month before the advance GDP report and the preliminary report. This is because GDP figure is frequently considered a lagging indicator meaning it can confirm a trend but it can't predict a trend. In comparison to the stock market the GDP report is somewhat similar to be income statement public company report at year -end.