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Economics and Business Studies
Economics is a social science that attempts to explain how the actions and decisions of firms, consumers and workers and governments affect the operation of the economy. It plays a huge role in our daily lives; it has links to international affairs and politics and is a subject that is often debated and discussed. It requires a fair deal of analysis and includes topics such as supply and demand, growth, inflation, globalisation and exchange rates.
Business studies is more concerned with the actions and decisions taken by firms and focuses on topics such as marketing, staff in the organisation, accounting and finance, management, strategy and production methods. Business studies students will also have to cover some Economics, as it affects how businesses operate in their external environments.
Although Business is not free from theory, it is less theoretical than Economics. Out of the two subjects Economics is considered to be the more academic by employers and universities. Business Studies requires less understanding than Economics, but it by no means an easy subject; instead it involves more learning and therefore has more work to cover, and a great deal of new terminology to grapple with. Therefore you might say that Economics course has more depth, with the Business Studies course having more breadth.
You do not need to be great at maths for either of these courses. However, for Economics, being comfortable with numbers is desirable due to the need to study graphs and economic data; the Business Studies course actually requires a greater use of numbers – through the Accounting and Finance module – and therefore being comfortable with numbers is essential. Given the nature of the topics covered, a degree in Economics or Business Studies can take you into almost any occupation. According to a recent survey, although Business Studies is the most popular degree course in the UK, Economics students are the second highest paid graduates in the country!
Still not sure? Then take a look at the following profiles:
Economics is concerned with the key issues facing us today, including globalisation, pollution and poverty. It is essentially about choice: why different sorts of people and groups of people, such as governments, have to make choices; the choices that they make, and the consequences of those choices. The work of economists transforms our lives – if you are a firm, consumer, worker, homeowner or the government you are concerned with, and affected by, Economics. Economics teaches students to think logically and to use theories to understand how economies operate. You will be taught methods used by economists and how to understand issues such as inflation, unemployment, pollution, demand and supply, exchange rates, interest rates, and the difficult decisions the UK Government face when they attempt to steer the economy in a chosen direction.
Not a day goes by without issues relating to economics being reported in the media:
- ‘The UK’s recession will be long and deep’
- ‘Worst economic downturn since 1945’
- ‘Government puts VAT back up to 17.5%’
- ‘Chancellor puts 50% tax on top earners’
- ‘Government borrowing rockets to £178 billion’
- ‘Passengers to pay pollution tax on flights’
- ‘The value of the pound plummets against the Euro’
- ‘Price of petrol rises to over £1 a litre’
- ‘Exports fall as global slump tightens its grip’
- ‘Unemployment reaches 12 year high’
- ‘UK house prices start to rise’
- ‘Bank of England slashes interest rates to record low of 0.5 %’
Studying economics can be compared to studying medicine. Medical students learn about the human body, what can go wrong and how to remedy it. Economics students learn how an efficient economy, and markets in the economy, should work; how market failure can occur and how governments can seek to improve economic performance.
A-Level Economics requires a reasonable level of numeracy, but it is not mathematical. It has a fair amount of conceptual thinking, with the main skill being the ability to analyse economic data, interpret graphs and tables, identify trends and explain these using economic theory, often through diagrams. The ability to see how one economic policy (e.g. low inflation) may affect other parts (e.g. employment) is paramount. This requires a clear mind and an ability to think and analyse logically and to write good English. The course is considered to be a ‘gold standard’ – an academic course that is well respected and liked by universities.
As the name suggests, the course studies how businesses function and looks at the work that various departments, such as marketing, finance, human resources, and production carry out. The course also looks at how outside activities affect businesses, and in turn, how businesses react to these; for example, the effect of changes in government policy, competition and demand, and also ethical issues – such as ‘green trading’. In addition, the A-Level draws together the business functions and the external environment to study the objectives and strategies that businesses adopt.
You will learn about the important decisions that businesses face in modern, competitive, and often global, environments. Topics such as:
- ‘How businesses advertise and price their goods’
- ‘The production method that best suits the product’
- ‘Why a call centre may relocate to China’
- ‘Marketing strategies a company should use’
- ‘Why firms might merge’
- ‘The characteristics of a good manager’
- ‘How a firm’s final accounts are compiled’
- ‘How a firm could increase its cash flow’
Although the course is very broad it does not teach you how to run your own business or to become the next Richard Branson! However, it will equip you with the knowledge to appreciate how modern, successful companies operate.