Economics is the science of decision making—understanding the costs and benefits of decisions made by individuals, communities, organisations and governments all of which affect our lives daily.
Economists analyse how and why decisions are made, from individuals’ consumption and firms’ production, to determining prices. Methods include designing abstract models of how agents make decisions and testing these models using real-world data.
Topics studied in economics include:
Determination of the prices and quantities of goods.
Consumer and organisation behaviour.
Taxes, subsidies and tariff.
Determination of the aggregate level of economic activity.
Climate change, resource allocation and management.