This document provides an introduction to statistics. It defines key economic terms like consumer, producer, and factors of production. It explains that economics is the study of how people and society use scarce resources to satisfy wants. Statistics helps quantify economic problems, enable comparisons, and identify relationships. Statistical data and methods are important for planning, economics, business, research, and administration but must be interpreted carefully using common sense.
This document provides an introduction to statistics. It defines key economic terms like consumer, producer, and factors of production. It explains that economics is the study of how people and society use scarce resources to satisfy wants. Statistics helps quantify economic problems, enable comparisons, and identify relationships. Statistical data and methods are important for planning, economics, business, research, and administration but must be interpreted carefully using common sense.
This document provides an introduction to statistics. It defines key economic terms like consumer, producer, and factors of production. It explains that economics is the study of how people and society use scarce resources to satisfy wants. Statistics helps quantify economic problems, enable comparisons, and identify relationships. Statistical data and methods are important for planning, economics, business, research, and administration but must be interpreted carefully using common sense.
This document provides an introduction to statistics. It defines key economic terms like consumer, producer, and factors of production. It explains that economics is the study of how people and society use scarce resources to satisfy wants. Statistics helps quantify economic problems, enable comparisons, and identify relationships. Statistical data and methods are important for planning, economics, business, research, and administration but must be interpreted carefully using common sense.
Class 11 Synopsis 1. Basic Terms 2. Definition of Economics 3. Ordinary Business Of Life 4. What Is Economic Problem 5. Why Economic Problem Arise 6. Economy And Its Components 7. Factors Of Production 8. Meaning Of Statistics 9. Scope Of Statistics 10. Importance Of Statistics In Economics 11. Statistics Methods Are No Substitute For Common Sense Basic Terms 1. Consumer – A person who purchases goods and services for personal use.
2. Producer – A person who produces goods. Example: Manufacturer.
3. Seller – A person who sells goods/services to make a profit. Example: Shopkeeper.
4. Saving – A part of the income which is not consumed.
5. Investment – An investment is the purchase of goods that are not consumed
today but are used in the future to create wealth.
6. Service Holder – A person who is in job to earn wages or salary.
7. Service Provider – A person who provides services for a payment.
8. Economic Activities – Any activity undertaken for a monetary gain.
Definition Of Economics Alfred Marshall a great propounder of Modern Economics defines economics as
“the study of mankind in the ordinary business of life.” Definition Of Economics “Economics is the study of how people and society choose to employ scarce resources that could have alternative uses in order to produce various commodities that satisfy their wants and to distribute them for consumption among various persons and groups in society.” Ordinary Business Of Life Economics is a study of mankind in the ordinary business of life.
Individual and social life actions
which are closely connected with the use of the material requirement.
Any activity undertaken for
monetary purpose is termed by economists as ordinary business of life. What Is Economic Problems Economic Problems are the problems of choice, or of allocating scarce resources to other uses due to scarcity of resources. These resources have alternative uses, which is why the problem of choice arises. Why Economic Problem Arise Human wants are unlimited, but the resources to satisfy those wants are limited and these resources have alternative uses. Resource Scarcity gives rise to the problem of choice among consumer and they make rational choice to satisfy their demand. Economy And Its Components A system in which people get a living to satisfy their wants through the processes of Production, Consumption, Investment and Exchange. It has four components:
1. Production: It is defined as ‘creation of utility’. It is
the process in which inputs are transformed to goods or services. 2. Consumption: It is defined as ‘usage of goods/services’. It is the process by which a good or a service is completely used up. Economy And Its Components 3. Investment: It is a part of production which is committed for future income.
4. Distribution: It is a part of production which explains
how the national income is distributed among different factors of production. Factors Of Production There are four factors of production:
1. Land: Part of the income goes to the owner of land
in the form of rent 2. Labour: Part of the income goes to the labourers for their services in the form of wages 3. Capital: Part of the income goes to the owner of capital in the form of interest 4. Entrepreneur: Part of the income goes to entrepreneurs in the form of profits Meaning Of Statistics Statistics is the quantitative information of facts and findings.
In singular sense: “Statistics may be defined as the collection, organisation, presentation, analysis and interpretation of data” {CO-PAI}
In plural sense: Statistics refers to information in terms of numbers or numerical data such as population statistics. Scope Of Statistics 1. In Planning: Planning is the combination of vision, goals, objectives, strategies, policies, etc. Statistics helps to get the necessary information about the planning which depends upon the analysis of statistical data.
2. In Economics: Statistical Analysis are used in solving
different economic problems such as consumptions, production, distribution, investment, unemployment, etc. Tools like Time Series Analysis, Demand Analysis, Forecasting Techniques, etc are used. Scope Of Statistics 3. In Business: Statistics help businesses to test and make correct decisions about the location of the business, marketing the product, financial resources, etc, based on the statistical information.
4. In State Management: In order to set different
policies to run an economy efficiently and allocating economy resources in various sectors based on different statistical tools. Scope Of Statistics 5. In Research Activities: Statistical techniques are used for collecting information during research and also for analysis and interpretation of research findings.
6. In Administration: It is being widely used to
formulate and forecast different plans and policies of the state administration. Importance Of Statistics In Economics Statistics has emerged as a lifeline of economics.
1. Quantifying economic problem: For example,
unemployment is said to be 20% of India’s working population.
2. Inter- Sectoral Comparisons: For example, looking
after the impact of unemployment in different sectors such as: rural or urban sector. Importance Of Statistics In Economics 3. Cause and Effect Relationship: For example, the cause of unemployment and its effect on market, inflation rate or on the economy’s growth.
4. Formulating Policies: For example, in order to set the
budget for the economy which helps in Fiscal policy.
5. Economic Equilibrium: For example, in order to
ensure equilibrium between market demand and market supply. Importance Of Statistics In Economics 6. Constructing Economic Theories: For example, we use statistics in Consumer Theory of Demand and Producer Theory of Supply, etc. Statistics Methods Are No Substitute For Common Sense • Statistical data may be misinterpreted. • Statistical data may be politically influenced. • Statistical data may involve personal bias. • Statistical data may be manipulated. • Statistical data may fail to reveal the errors committed.
Therefore, students are advised to use their common
sense while working with the statistical data. Thank You! Lesson by
Anjali Kaur Suri
TGT Maths, PGT Economics
M.A. Economics, M.Com (Finance), PGD Banking & Finance, B.A. Hons (Economics), B.Ed (Maths & SST), NISM, NSDL and IELTS certified.
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