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Answer» Following are the 5 components of the subject matter of economics: - Consumption : Consumption is that economic activity which is associated with the consumption of utility of goods and services for direct satisfaction of individual and collective requirements.
- Production : Production is associated with increasing the utility or value of goods and services.
- Exchange : Exchange is associated with sale and purchase of a product or service. Exchange is required for consumption of goods produced and for fulfillment of wants
- Distribution : Production is the result of collective efforts of various resources. Therefore, it is very important to determine the remuneration for every resource of production under the process of production and this is known as income distribution.
- Public Finance : Study of public income, public expenditure, public debt, deficit financing system, tariff system, etc. are done under this branch of economics.
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