Distinguish between static and dynamic economics. What are their merits and demerits answer ?
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STATIC THEORY OF ECONOMICS :
The stationary state in an economy in which the tastes , resources and technology don't change through time.
Static analysis doesn't show the path of change.
It only tells about the conditions of equilibrium.
It called a 'still picture' of marketing.
It also known as timeless economy.
DYNAMIC THEORY OF ECONOMICS :
Clark's Dynamic Theory pronounced by J.B Clark , who believed that profits arise in the dynamic economy and not in the static economy.
Dynamic equilibrium is held stable by equal but opposing forces.
It called 'movie' of the market.
Time element occupies an important role.
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