Sometimes, statistics give such results which do not sound sensible as per common sense. In fact, there is no substitute of common sense not statistics as well. For example, suppose a person conducted a survey and found that the places where there were larger numbers of hospitals, death rates were higher. So, he concluded that hospitals are responsible for increasing death rates. Another Example can be situation when you collect data on birth rate and rainfall. You find that the years when there was higher rainfall, birth rate was high and you conclude that rainfall is one of the cause of high birth rate. Therefore, we say that statistics are not substituted for common sense.

Economics is required in all spheres of life.
(a) As a Consumer: All of us have a limited income and we wish to satisfy our unlimited wants from it. Economics helps us to take optimum decisions regarding consumption and allocation of income to different goods and services.
(b) As a Producer: A producer wants to produce his goods and services in such a way that his cost is least and profits are most. Economics gives such principles which help him to attain such a combination.
(c) As an Investor: As an investor, we need to invest our funds in such a venture which give us maximum returns with minimum risk. Once again Economics gives such principles which help him to attain such a combination.
(d) As a Citizen: As a citizen, Economics helps us to understand the impact of Government policies on our society and economy. Accordingly, we can say if government is working efficiently or not.
(e) As a human being: When we apply the principle of scarcity on our life, we realize that time is our scarce most resource and is non renewable. I can't increase my life by one second by spending my entire wealth. Therefore, I must make best possible use of my time. It teaches us efficiency, optimum utilization, no wastage, rationality and decision making by cost-benefit analysis.

However human wants are unlimited but these wants vary in their intensity and urgency. Some wants are more intense and urgent than others. We give priority to more intense and urgent want. For example, a family wants to go to Switzerland for enjoyment and also wants to buy a house as it is living in a rented house, we can expect them to buy a house first and go for a trip later. A consumer chooses such combination which gives him maximum satisfaction, a producer uses such combination which gives him least cost and maximum profits, an investor chooses that investment which gives highest returns.

Our wants are unlimited but resources to satisfy them are limited. For example, your family has limited income however, you have unlimited wants. You want to buy so many goods and services which in your limited income, you cannot buy. Therefore, you have to make a choice. Similarly, you have limited time and so many uses. You want to study, play, dance, sleep, chat but you can't do all that you want in limited span of life. So you need to make choice once again.

No government policy can be formulated without support of data. Government uses statistics to analyze all economic problems be it poverty, unemployment, population, demographic challenges or any other. For example, if government wants to introduce a policy for improving educational status amongst girls then it first needs to know the extent and causes of problem. Statistical tool provide a great help in it. Once the policy is announced, even for checking the efficacy of the policy, statistics will be used. Similarly, if government wants to do something for controlling population of the country, it needs to announce an effective population policy. An effective policy will be one which attacks on causes of high birth rate and to know causes of high birth rate, statistical tools once again will be helpful.

Following activities constitute ordinary business of life.
(a) Production
(b) Consumption
(c) Investment
(e) Exchange
(d) Distribution