Question

Pigou's definition of economics, was restricted only to economic systems ___________.

• A. which were guided by the market forces or monetary terms
• B. in which production and investment were undertaken with business motive
• C. both (A) and (B)
• D. neither (A) nor (B)

Answer 1

Answer: (C)

both (A) and (B)

Arthur Cecil Pigou was an English economist who defined economics as a relationship between various economic variables like consumption, wealth, employment and output during different situations in an economy such as inflation deflation etc.
Therefore, his definition of economics was very much restricted to individual variables like market forces, prices in the economy, production or output which made the definition less effective as an economic system.