7 Difference Between Economics and Finance

Economics and Finance are two terms which are used to maintain the economy of the country. Economics deals with the use of limited resources to make required products to fulfill the basic needs. While Finance is the study of management of money funds, banks etc.

Economics mainly deals with the demand and supply of the goods. Goods rates, distribution, inflation, unemployment. Finance is also related to economics which deals with the money in and out loan rates, interest rates etc. Many people think both the terms are the same but there are many differences between economics and Finance. In this article we will discuss in detail about the difference between economics and finance, their comparison and definition. So read the full article and clear your doubts.

Economics vs Finance

Sr. No.	Economics	Finance
1	Economics deals with the human behavior towards the use of limited sources to satisfy their needs.	Finance is the total management of the funds and money.
2	Economics is a knowledge which concentrates on the production, distribution and exchange of goods.	Finance is a subcategory of economics which concentrates on the money management to attain highest returns.
3	Main aim of economics is focused on money and the value of time.	Finance focuses on time, the value of money simply means the value of money today is more than the same money after one year.
4	Economics is mainly focused on the use of the limited resources to get satisfied.	Finance aims to collect funds and increase wealth.
5	Main discussion is to utilize the limited resources in an effective way that will last long.	Discuss how to utilize our funds to increase our business and wealth.
6	All decisions are taken by the higher authorities.	Everyone has the power to make decisions.
7	Deals with big and small issues like unemployment inflation and demand and supply.	Is related to personal corporate, business and state financial growth.

Economics

It deals with the behavior of the human for the products demand and supply from the limited resources. Economics also deals with the production, consumption, distribution and exchanges of goods . It is based on the money value of time. Economics has two parts: micro and macro economics which deal with different fields. Micro economics mainly deals with the particular  person, firm, or business needs and demands.

It is the study of demand and supply of the required goods from limited sources. Microeconomics is the deep study of how a product’s demand increases or decreases with time and changes of rates. It also keeps an eye on the companies who manufacturers the product. Micro economics provide the guidelines for the product like production quantity and price of the product.

Macroeconomics deals with the big issues of the nation like unemployment, inflation and national income. It keeps eyes on the unemployment rate in the nation which affects the economy of the country. Macroeconomics also keeps an eye on international policies. Simple meaning macroeconomics is the branch or economics who’s deals with the big issue of the country.

Finance

Finance is a subcategory of economics which deals with money matters like saving, lends, loans and interest rates. It is a study or knowledge which helps us to save money for the future. To grow any business or self worth we should have good knowledge of finance. Like we should have knowledge about how money works, how to invest. Finance is the complete knowledge of becoming wealthy. These days financial knowledge is very important.

Finance is nothing but fund management. The main aim of finance is to increase or maximize personal or country wealth. There are some types of finance. “Personal finance” is related to a particular individual or family. Personal finance is individual needs of money, filling bills, taxation and other financial needs. Personal finance is very important for personal growth.

Corporate finance” it deals with the funds management for the particular corporations.

State funds” the financial activities which are related to the country, state or city are called state funds.

Main difference between economics and finance

1. Economics deals with the human behavior towards the use of limited sources to satisfy their needs. While Finance is the total management of the funds and money.
2. Economics is a knowledge which concentrates on the production, distribution and exchange of goods. Finance is a subcategory of economics which concentrates on the money management to attain highest returns.
3. Main aim of economics is focused on money and the value of time. While Finance focuses on time, the value of money simply means the value of money today is more than the same money after one year.
4. Economics is mainly focused on the use of the limited resources to get satisfied. Finance aims to collect funds and increase wealth.
5. Economics’ main discussion is to utilize the limited resources in an effective way that will last long. While in finance we discuss how to utilize our funds to increase our business and wealth.
6. In Economics all decisions are taken by the higher authorities. In finance everyone has the power to make decisions.
7. Economics deals with big and small issues like unemployment inflation and demand and supply. While Finance is related to personal corporate, business and state financial growth

Conclusion

Bothe economics and finance are two major aspects which are directly related to the economy of the country. Economics and finance are very important these days. Bothe economics and finance has their own fields like economics deals with the unemployment and demand and supply issues. While Finance solve the money problems. Economics and finance play a big role in the wealth and economic growth of the country.

This is all about economics and finance. We hope you understand the topic very well. If you have any doubt please feel free to comment on us. For more topics like this please go through our website