Economics is the study of resources, their scarcity and the unlimited wants of mankind. The most appropriate definition is that by Lionel Robbins who defined economics as ‘The science which studies human behaviour as a relationship between ends and scarce means which have alternative uses.’ Analyse this definition closely.
1.0 INTRODUCTION
Economies can be defined as, thrifty management of resources, such as land, labour, capital and enterprenuership learned to practice economy in making out the household budget. In factors of production there are commodities or services used to produce goods and services. And also explores how people and society try to use resources available , which have many different uses, in order to produce different goods and distribute among people. According to economist Lionel Robbins who defined economics as ‘The science which studies human behaviour as a relationship between ends and scarce means which have alternative uses. The primary factors facilitate production but neither become part of the product as raw materials. One of the factor of production is mainly called Land includes not only the site of production but natural resources above or below the soil. What is scarcity? Scarcity is a things that has some problems in economic having because of humans nature unlimited needs and wants. Humans were always wants more and more thats unlimited goals. This world has a limited resources which can be used. What will happened when all of the four factor of production is limited?
Factor of productions is defined as the input that used in the production of goods or services in the attempt to make an economic profit and also production can be defined as the resources that required to generaton of goods and services. This resources are generally classifeid into four major groups which are land, labour, capital and enterprenuership.
So what is land? One of the factor of production is mainly called land, includes not only the site of production but natural resources above or below the soil. Land is a natural resource that whose supply is generation by generation fixed. Land contains natural resources that a production of good and also a capital goods. Example of the natural resources in land is petroleum, coal, diamond, timber, gold and many more. If this land is became limited there are huge problem will this world faced, some of the problem is natural resources cannot be extracted or maybe become limited. Among this there a another factor of production is called capital, what is capital? Is that capital is important to our economy? Capital is a money. Capital played main role in this factor of production because the capital is helped we to buy the raw materials, machines, equipment, tools and many more.
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The next factor of production is labour. What is the meaning of labour? Labour is means the people is working for a wages. The size of a labour force can be determined by population of adult in a country. Labour consists of the both physical and mental abilities of the workers to work in a company or in a working place to get a wages. Lets say the labour has been limited, what will happened? They cannot produce goods and sevices, example like, if one company’s labour is limited the production of product will stopped and will effect the company, because of this the economy will be effect. The last things in factor of production is entrepeurnership is a defined as a businessman, is a individual who uses all the resources effectively to run production. He should be risk taker and wiling to accept new challengers or wiling to accept lost or profits on their business.
1.2 WHAT IS SCARCITY?
In other word for scarcity is means not enough resources. The main cause this scarcity is happened because of unlimited needs and wants of human. For an example just ask with the people out there “would you like more luxury life” most of them will answered ‘Yes’. People were looking foe more money for buy more goods and services. This problem not only carried by poor people its also to most wealthy people were include in this problem. In any time this world can be limited amount of goods and services such as for land when we compared Malaysia and Singapore, Malaysia has big land then Singapore, so the land is so limited to Singapore then Malaysia. In Singapore the singaporeans can built their own property like houses and more this is called scarcity. The example of capital became limited is to run one company he must have capital for the production if its limited there are don’t have any company industry. Limitation of third factor of production is labour, for example if the labour became limited the are no one to work at companies, and the companies will not run any production. Lastly about enterprenuer, lets take that the enterprenuer is became limited what wiil happened, there are no new production of product, the procduction not run as planned and more.
To outcome these factor of production problem, must tasks on the evidence of scarcity, the evidence of plenty and research why this problems were created. What is really the opportunity cost means? Opportunity cost is a cost of next best alternatives from all.
CONCLUSION
As a conclude, every country has it own resource, we must balanced the factor of production and if one of this factor of production land, capital, labour or enterprenuership is limited is must cause the growth of economic. If don’t have land they cant built any company, if capital became limited we can’t pay wages to labour, if labour became limited no workers in companies if enterprenuer no new product, so must balanced and protect our factor of production.
QUESTION 2
Malaysia, a mixed economy attempts to combine the advantages of Free Enterprise System and the Central Command System. The price mechanism is allowed to operate but in some cases the price mechanism fails or works against public interest. Identify the ways by which the State can intervene to correct the defects.
1.1 INTRODUCTION
Production, distribution, and consumption of good and service were a branches of economics in science. What is ecomomy system? Economy system is a planned organization and structure of production. Allocate of economic inputs, distribute of economic outputs and consumption of goods and services in an economy. Economy system are separated into three major economy thats named planned economy, mixed economy and lastly free market economy. There are three different types of organization economy plan that also very tight and some confortable and some of economy plan is very freedom.
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As I told the three economy system, this is first economy system called planned or command economy, this system is fully controlled by the goverment. There are no arguement or such things in that country because the country is very strict and on the mission and vision to achieve so when the country planned system the mission and vision will achieve more quickly. Free Market Economy is an system based on power of division of labour in which the prices of the goods and services are determined in a free prices system set by supply and demand and the decision taken by individual household and firms and with no goverment intervention. The price also as how much they produce. Mixed ecomony were controlled by partly goverment and partly through the market.
1.2 CONTENT
In our Malaysia country is the mixed economic system. Mixed economy reflects the characteristics of both capitalism and socialism. In this mixed economy system there are all real world economies are mixture of the two system. In mixed economy goverment will intervention like some relative prises because the goods and inputs by taxing or subsiding them or by direct price controls. Most mixed economies also can be described as market economies with strong regulatory oversight, in addition to having a variety of government sponsored aspects. Government also must have the rights to control the price of products and services in our Malaysia country. Example of Malaysian government control item are like rice, oil, sugar, petrol, flour and more. SIRIM is a not goverment company but the goverment intervention because they have to know is th product is really good. Mixed economies as an economic ideal are supported by people of various political persuasions. Another example of Malaysian goverment intervention in the market by pose tax on goods, for example goverment taxed on cigarretes, petrol, alcohol drinks and more.
Conclusion
As conclusion, Malaysian economic system is mixed economic system. Mixed economy reflects the characteristics of both capitalism and socialism. Malaysian government intervene in the economic in many ways such imposed tax og good, control the price of the product, make sure the price of the product is not high and many more.
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