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Economics 101

- By Yasser Aboraya -
Whether you understand economics or not, you must’ve noticed that Egypt right now is suffering from an excruciating financial and economic slump to say the least. That’s probably why for the past months you’ve been hearing about things like monetary policies, fiscal policies, and inflation (probably felt this one too). As such, for all you “unaware” readers out there, here is a crash course into economics that would hopefully help you get the gist of things. So what the hell is this thing? On the basic level, economics is planning for the most efficient and effective allocation/utilization of scarce resources. Since all resources nowadays are considered scarce, we can safely say that everyone practices economics by planning spending habits, carpooling, or sharing sneakers with the annoying-but loving, “big-foot” of a sister (or brother….or both). Now I’m not going to confuse your pretty little mind with the intricate differences between Macro and Micro economics just yet, but just bear in mind that Macro=Big, Micro=Small. Taking this a step further, we can deduce that state economic planning is Macro and household planning is Micro. Building on the above, those that call themselves “Economists” are the ones that “should” have enough analytical and planning skills to assist in dictating how the economy (or institution) will operate, taking into perspective social and profit-maximization factors. In reality however, they either shift to marketing or they end-up writing articles trying to make themselves feel special (e7mm…). Subbly w Demand One of the first things you will learn about economics is that it is about simplified theories, numbers, statistics, and $h% loads of graphs. The most important of such graphs is the representation of supply and demand forces in any given market. Simply speaking, the supply for a given good is how much is available and the demand for a certain good represents how much is…..demanded, Duh!! Add to the above the term “value” and you will be able to logically deduce that if a good is oversupplied, then its value (or price) should be lowered, and if it is under-supplied and overly demanded, then the value should go up. ♫ Money Money Money Moooney, Moneyyyyyy ♫ Lets get this one straight, cash is king and in economics its not that different. Why? Well for starters it’s a good store of value that is countable, easily exchanged for products and services, and easily converted to different currencies. That is precisely why we now have an I'm too tired w msada3 awy, i don't think eni ha2dar agilek el naharda currency system. Because of this system, we can trade with different countries and you as an individual can exchange US dollars for Egyptian pounds or vice-versa (Men el Bank 3ashan Masr Teb2a Ad el Donya). Now this does not entirely mean that cash is better than gold, but you can’t walk-up to a store and buy two bottles of milk with a gold bar in your hand…7atakhod bel ba2y beda3a ya fale7. Salatat and 7abashtakanat Economics is a huge field that covers several financial and policy-making aspects so do not assume that this is the whole picture. Things like politics, black-markets, budgets, interest rates, etc… are all aspects that play a huge role in understanding economies and solving financial issues. This is why text-book economics is not as complicated as real-life economics. Anyways, we will try to do our part in covering this and if you don’t understand anything, well then… you’re a dummy.

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