ECONOMIC BASIC - B.E,(CS FINAL & IT 3RD YEAR) Dr.K.BARANIDHARAN, SRI SAIRAM INSTITUTE OF TECHNOLOGY, CHENNAI

8/12/2019 ECONOMIC BASIC - B.E,(CS FINAL & IT 3RD YEAR) Dr.K.BARANIDHARAN, SRI SAIRAM INSTITUTE OF TECHNOLOGY, CHENNAI

1/22


2/22

Prepared by :Prepared by :

Dr. K. BARANIDHARANPROF.MBA

SRI SAIRAM INSTITUTE OF TECHNOLOGYCHENNAI

ENGINEERING ECONOMICSAND

FINANCIAL ACCOUNTING

Sri Sairam Institute of Technology 2


3/22

EngineeringEconomics& Financial

Accounting ment

E e f a330 July 2014


4/22

ENGINEERING ECONOMICS

Engineers have an addedresponsibility and that is to include

economics in their calculation &decisions. When the economicsprinciples are applied to engg.Problems, then a new branch ofknowledge called engineering

economics Sri Sairam Institute of Technology 4


5/22

What is Economics? The word Economy derived from the Greek

word okios which meanshousehold

Human wants are unlimited Resources available to satisfy these wants

are scarce / limited People wants to maximize their

gains The science of making decisions in the

presence of scarceresources.



6/22

ECONOMICS Economics is a social science

that studies the behavior ofhuman beings. Organizationor any entity mode up ofhuman beings in situationsinvolving choice .



7/22

ECONOMIC ACTIVITIES

The activities are carried out withthe purpose of earning onincome or making money, theyare called economic activities .

Activities involvue MONEY Earning income in either CASH or

KINDSri Sairam Institute of Technology 7


8/22

NON-ECONOMIC ACTIVITIES

The activities that are

performed out of LOVE,affection and social

concern but not formoney



9/22


10/22

PROFESSION

Profession is an occupation carried on byprofessional people like Doctors, Lawyers,Engineers, etc.

They provide specialised services in returnfor fees.

To become a professional, a man requiresspecialized knowledge and professionalqualification. For e.g. Doctor needsspecialised knowledge in medicine, alaw er needs a de ree in law etc.

6/18/2014 10


11/22

EMPLOYMENT

Employment is a type of occupationunder which one person provides hisservices, physical or mental to

someone else in return for which hegets salary or wage.

The person who employs is calledemployer and the person who isemployed is called employee or

worker .6/18/2014 11


12/22

BUSINESSBusiness is an economic activity concerned with

production and distribution of goods andservices with the aim to earn profit .

It includes all those activities which are directlyor indirectly concerned with production,purchase and sale of goods and services.

So the production, marketing, advertising,warehousing, insurance, banking , etc. are allbusiness activities.

6/18/2014 12


13/22

ECONOMIC CIRCLE



14/22

ECONOMICS - DEFINITION FATHER OF ECONOMICST:- Adam Smith defined

economics as Economics is the sciences ofwealth

wealth? Wealth has been defined as stock of goods

existing at a given time that have money value . classification of wealth. Personal wealth(individual wealth) Social wealth( collective wealth) National wealth (a+b) Cosmopolitan wealth (e.g. ocean)Sri Sairam Institute of Technology 14


15/22

Alfred Marshall Economics isdefined as a study of mankindin the ordinary business of life

Lionel Robbins :Economics is thescience which studies humanbehaviour as a relationship

between ends and scarce meanswhich have alternative uses



16/22

MICRO ECONOMICS

Micro means small. Microeconomics deals with

problems such as the output ofa single firm, price of a single

commodity and spending ongoods by a single household.



17/22

MACRO ECONOMICS

Macroeconomics studies theeconomic system as a whole . In it,

we get the complete picture ofthe working of the economy . It isa study of economic Aggregatesuch as total employment,savings, and investment



18/22

DIVISION OF ECONOMICS

Consumption Production Exchange

Distribution Public Finance



19/22

Types of the economic systems CAPITALIST ECONOMY: An economic system based on private

ownership of capital

Capitalism encourages privateinvestment and business, compared to agovernment-controlled economy.

Investors in these private companies (i.e.shareholders) also own the firms andare known as capitalists.



20/22

MIXED ECONOMY

Both private

individuals andgovernmentparticipate in seekinganswers for the above



21/22

FREE OR LAISSEZ-FARE ECONOMY

The economy where

government keeps itshands off such majoreconomic decisions.



22/22

Documents

ECONOMIC BASIC - B.E,(CS FINAL & IT 3RD YEAR) Dr.K.BARANIDHARAN, SRI SAIRAM INSTITUTE OF TECHNOLOGY, CHENNAI