Introduction to Economics and Statistics [AHSEC Class 11 Economics Chapterwise Notes]

Introduction to Economics and Statistics (3 Marks)
AHSEC Class 11 Economics Chapterwise Notes

Economics Class 11 New Syllabus Notes

Q.1. What is economics? Who is called father of economics and statistics?     2015

Ans: Economics is the science which studies human behaviour as a relationship between scare means and ends.

Adam smith is called father of economics.

Gottfried Achenwall is called father of statistics.

Q.2. Define the term Statistics in singular and plural sense. What are its Characteristics? Mention its Functions and Limitations.

Ans: Statistics: The word Statistics seems to have been derived from the Latin word “status” or the Italian word Statista.

Statistics in Singular Sense – It deals with the collection, presentation, analysis and interpretation of quantitative information.

Statistics in Plural Sense – It means aggregate of facts affected to a marked extent of multiplicity of causes numerically expressed, enumerated or estimated according to reasonable standard of accuracy, collected in a systematic manner for predetermined purpose and placed in relation to each other.

Characteristics of Statistics:                        2015, 2017

(i) Statistics are aggregates of facts.

(ii) Statistics must be numerically expressed.

(iii) Statistics should be capable of comparison and connected to each other.

(iv) Statistics should be collected in a systematic manner.

(v) Statistics should be collected for a definite purpose.

Importance of Statistics: Statistics is widely used in many fields.       2015, 2016, 2017

a] Importance to the Government: Statistics is used in administration and efficient functioning of departments. It collects data to fulfill its welfare objectives.

b] Importance of Statistics in Economics: Statistics helps in making economic laws like law of demand and concept of elasticity.

1. It helps in understanding and solving economic problem.
2. It helps in studying market structure.
3. It helps in finding mathematical relations between variables.

Limitations of statistics are as follows:

(i) Statistics deals only with quantitative characteristics.

(ii) Statistics deals with aggregates not with individuals.

(iii) Statistical laws are not perfectly accurate.

(iv) Statistical results are only an average.

(v) Statistics is only one of the methods of studying a problem. Statistical tools do not provide the best solution under all circumstances.

(vi) Statistics can be misused.

Q.3. What are economic and non-economic activities? What are various classes of business activities? 2016, 2017

Ans: Economic activities are those that are concerned with production, exchange and distribution of goods and rendering of services to earn money.

Non-economic activities are those activities, which are pursued by human beings because of social, psychological and religions sentiments.

Classification of Business Activities:

1. Industry

2. Commerce

3. Trade

1. Industry: It includes production or processing of goods and services. It is concerned with changing the form of the products. It gives form utility to the products.

2. Commerce: It includes all those activities which are concerned with removing all the hindrances in the movement of goods from the manufacturer to the consumers. It includes trade and auxiliaries to trade.

3. Trade: Trade means exchange of goods and services between sellers and buyers with profit motive.