Quality Methods of Economic Analysis - Deductive and Inductive

Quality Methods

of Economic Analysis Deductive and Inductive

Economic Analysis is a systematic approach to determine the optimum use of scarce resources that mainly involves comparison of two or more alternatives in achieving a specific objective under the given assumptions and constrains.

Deductive Method: Information

This method derives new conclusion from fundamental assumptions or from truth established by different procedures. This mainly involves the simple process of reasoning from certain laws and several guidelines that are assumed to be true according to the analysis facts and points.

Selecting the Problem: unemployment and inflation This mainly helps to showcase the several main factors like poverty, etc.

Formulating Assumptions: This is another main step that helps to deduct on the basis of the hypothesis.

Testing and verifying the Hypothesis: This is last and final step of the deductive method that helps to give the result. we use several kinds of method and economics theories to get the productive result.

Inductive Method: Information

This is one of the best process to get the quality result because it is completely based on the real facts. Here we need to define the entire processing perfect format by using the best and quality data. This is mainly used by economist so that they collect the quality result later.

Selecting the Problem: Here we need to find the problem first because all the steps are completely based on this step. According to the problem we can get the numbers of facts which we are trying to find according to the situation.

Data: This is another main step because here we need to collect the gigantic numbers of information that helps to solve the problem.

Observation: Data are used to make observation about particular facts concerning the problem.

Generalisation: According to the observation, generalization is logically derived which establishes a general truth from particular sector.

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