What Questions Can Economics Help Us Answer?

What questions can economics help us answer? How much should top athletes be paid? Why do smartphones cost so much? What causes the stock market to go down? Why can't we just grant more money? These are some of the big questions that economics can help answer. The study of the economy as a whole is called macroeconomics. For example, a government's spending power is limited, deciding how governments should spend money affects the lives of people. Spend less on education, and poverty may increase. Cut military spending and soldiers may be unprepared on a conflict. Which choices make the most economic sense? In some ways these decisions resemble the ones families and companies make every day. How much money should be saved for retirement? Is it wise to invest in real estate? How will the price of raw materials affect profits? The study of economics at the household company or industry level is called microeconomics. Consumers, workers, and people who produce goods generally use some type of economic thinking to help them solve problems. They rely on information, data and reasoning to choose the best alternative based on limited options. Producers for example are constantly seeking new ways to increase productivity while reducing the cost of bringing their products to the market. Yet people don't always rely on economic thinking to help them make better decisions. Why? That's also a question that intrigues economists, it turns out that people frequently base their decisions on emotions, nostalgia, relationships, and beliefs especially when it comes to the products they really like. That's why economists are called upon to answer questions about what to produce, how to produce it, and for whom. Every economy needs to decide how much of something to make based on the behavior of consumers, and since human behavior is complex economists never run out of questions to answer.