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Economics

Economics is the social science that studies the production, distribution and consumption of goods and services.
Economics is the study of how people choose to use resources. Resources include the time and talent people have available, the land, buildings, equipment, and other tools on hand, and the knowledge of how to combine them to create useful products and services.
Economics studies how people appear to use the resources available to them to improve their well-being. Well-being includes the satisfaction people gain from the products and services they choose to consume, from their time spent in leisure, and with family and community, as well as in the jobs, and the security and services provided by their governments.
Economics is the science of choices. Scarcity is the core problem of economics. The fact that the available resources are insufficient to satisfy all desired uses thereof.
Economics tries to explain the choices people or households or businesses (economic agents) tend to make under different circumstances based on self interest. Choices such as how much time to devote to work, to school, and to leisure. How much money to spend and how many to save or invest, and how to combine resources to produce goods and services, and how to vote and shape the level of taxes and the role of government.So Economics can be considered as the study of decision making.

Economics explains how people want certain things to improve their living standards and can change their behaviour to get those things, in other words people will respond to incentives. Lower tax rate in another country and higher wages motivates an individual to move overseas. Lower wages in another country provide an incentive for a factory to relocate to that country. High tax rates motivates people to look for ways to invest their extra income in insurance or govt. bonds and securities because they want to keep more of their money for themselves.
Hence, economics include the study of labour, land and investments, of money, income, and production, and of taxes, and government expenditures.
Economists seek to measure the well-being of people in a society or a country, to learn how well-being may increase overtime, and to evaluate the well-being of rich and poor.
They help the governments to make policies and advice how to avoid problems such as inflation and unemployment, and to determine the level of taxes in order to improve the living standards of it's citizens. Along with individual behaviours, economics also addresses the collective behaviour of businesses and industries and countries and governments.

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The Intuitive Lowest Cost Method

The Intuitive Lowest Cost Method Or The Minimum Cell Cost Method

The Intuitive Lowest Cost Method is a cost based approach to finding an initial solution to a transportation problem.
It makes allocations starting with the lowest shipping costs and moving in ascending order to satisfy the demands and supplies of all sources and destinations.

This straightforward approach uses the following steps.
Identify the cell with the lowest cost.Allocate as many units as possible to that cell without exceeding the supply or demand.Then cross out the row or column or both that is exhausted by the above assignment.Move on to the next lowest cost cell and allocate the remaining units.Repeat the above steps as long as all the demands and supplies are not satisfied. 
When we use the Intuitive Approach to the Bengal Plumbing problem, we obtain the solution as below.

Transportation Matrix for Bengal Plumbing From \ To Warehouse E Warehouse F Warehouse G Factory Capacity Plant A Rs.50
Rs.40 100 Rs.30 100 Plant…

Vogel's Approximation Method (VAM)

The Vogel's Approximation Method

In addition to the North West Corner and Intuitive Lowest Cost Methods for setting an initial solution to transportation problems, we can use another important technique - Vogel's Approximation Method (VAM).
Though VAM is not quite as simple as Northwest Corner approach, but it facilitates a very good initial solution, one that is often the optimal solution.
Vogel's Approximation Method tackles the problem of finding a good initial solution by taking into account the costs associated with each alternative route, which is something that Northwest Corner Rule did not do.

To apply VAM, we must first compute for each row and column the penalty faced if the second best route is selected instead of the least cost route.

To illustrate the same, we will look at the Bengal Plumbing transportation problem.

Transportation Matrix for Bengal Plumbing From \ To Warehouse E Warehouse F Warehouse G Factory Capacity Plant A
Rs.50
Rs.40
Rs.30 100 Plant B
Rs.80
Rs.

Market

A market in any one of a variety of different systems, institutions, procedures, social relations or infrastructures whereby persons trade, and goods and services are exchanged, forming part of the economy. It is an arrangement that allows buyers and sellers to exchange things. Markets vary in size, range, geographical scale, locations, types and varieties of human communities, as well as in the types of goods and services traded. Some Examples include, local farmer's market held in town squares, Shopping Centres or shopping malls, Financial Markets such as International currencies or commodity markets or Equity stock markets, legally centred markets such as pollution permits, and illegal markets such as black markets for illicit drugs or weapons. In mainstream economics, the concept of market is any structure that allows buyers and sellers to exchange any type of goods, services and information. The exchange of goods or services for money is called a transaction. Thus a market ha…