Economics is the social science that studies the production, distribution, exchange, and consumption of goods and services. It aims to understand how economies work and how scarce resources are allocated among individuals and societies. There are two main branches of economics: microeconomics and macroeconomics.
Microeconomics is concerned with the behavior of individual actors in the economy, such as households and firms, and how they make decisions about production and consumption. It studies how prices are determined in markets and how individuals and firms interact to allocate resources.
Macroeconomics, on the other hand, focuses on the economy as a whole, and is concerned with issues such as inflation, economic growth, and the balance of payments. It studies the relationships between the different macroeconomic variables, such as Gross Domestic Product, unemployment, and interest rates, and how they interact to determine the overall performance of the economy.
Economics plays a critical role in shaping public policy and addressing important issues facing individuals and societies, such as income inequality, unemployment, and the provision of public goods and services.