Question

Define static and dynamic economic and their scope

Answer 1

Another difference between static economics and dynamic economics is that static analysis does not show the path of change. It only tells about the conditions of equilibrium. Static economics is called a 'still picture' whereas the dynamic economics is called a 'movie' of the market.

Answer 2

In dynamic economics we study the economic variables like consumption function, income and investment in a dynamic state. According to Prof. Harrod, “Economic dynamics is the study of an economy in which rates of output are changing.”