What Is The Relationship Between Economics And Finance?

[Good-Guy]

Trade and commerce is a really vast field that has been attracting many people across the world and this is why there are many people who pursue a successful career in this field and they tend to manage the finances of many companies in an efficient way. This is what many people learn when they get into this field. However, management of finance is not at all possible if we overlook the relation it has with economics. Regardless of what many people say, economics and finance are deeply connected with each other.

I must say that Finance is just fuel for the commercial activities and economics is a device that helps the vehicle of business to save this fuel so that the vehicle of business could run for a longer time. I define economics as a way to save finance or use finance in the best way and make the most out of it. Just imagine having a good water supply at your house, if you use it wisely, then you will be able to use it for a long time. If you waste it continuously, then you will run out of it quickly. This is how economics save finance when it comes to business. So how do you see this relationship between economics and finance?

 

[Jasz]

With the rapidly growing information sector, a lot of people would ask basic questions about the relationship between economics and finance. This is a question that many people want answered since it was ground breaking problems in these two areas that made businesses consider cross-functional management systems.



Economics and Finance are separate disciplines of study with similar missions. Economics tries to analyze how the economy functions while Finance tries to more directly affect the economy. Finance is a field better suited for studying how money is used in tangible decisions like where to invest or how to make payments.


Meanwhile, Economics studies the underlying principles of money, its value and uses, as well as its impact on society. Economics deals with the production, distribution and exchange of goods and services in a particular country within a certain period of time. Finance is all about money, specifically how individuals and groups use money as part of their daily financial activities.

 

[Kingsley]

Economics and finance are two subject that are strongly interrelated and they are interwoven. Because they share alot of principles and concepts but there is something about economics that makes it all encompassing beyond the scope of just finance. I can safely say finance is actually an aspect of economics. Finance as it stands deals with the figures and all other concept that is more related to accounting and accountability while economics is a subject that does not just study the figures but also looks in human behaviour and how they relate with the figures. Economics principles adopts scientific methods in carrying out it research and procedures. When we consider the concept of opportunity cost; the finance man or woman will define it as opportunity forgone while the economist will define it as the next best opportunity forgone, in the accounting for profit the finance person doesn't take opportuniy cost concept into consideration hence their profit margin always look higher than that of an economist who always take into account the opportunity cost, which result into a lower profit figure.

Economics is more broader than finance, as most of the concept of finance is drawn from economic assumptions and principles .

 

[Good luck]

Economic is the general view of what the society as a whole is.looking at the GDP and the market structure while finance has to do with the Momentary aspect of it.the way you spend the fund being generated and how such fund can be used to put things in order.both economy and finance have same similarities except for some little difference.

 

[Yusra3]

Economics and finance are as unbreakable as the bolts used in physically connecting them. Economics is concentrated on the production, distribution, and consumption of commodities and services, whereas, finance includes the activities related to the creation, management, and study of money, banking, investments, assets, and liabilities. Finance, however, is the field that keeps complying with the overall economic principles relating to such factors as supply and demand, market behavior, and pricing models. Perturbations in economics transversally affect both the financial industry and its framework, in both a global and personal scale.