The Importance Of Economics As A Science

The main function of the economy is to explain facts and phenomena related to the production, exchange and consumption of goods and services. It studies the behaviour of organizations and individuals involved in economic activities. It also studies the reasons that lead them to carry out these activities.

Economics formulates laws and principles that people use not only to explain but also to predict the occurrence of economic facts and phenomena and to influence their development.

Economics, as a science, fulfils 3 functions

Explain economic facts and phenomena;

Predicts the production of economic facts and phenomena;

Proposes ways to influence the way economic facts and phenomena unfold.