Principles of economics

The first four principle was related to how people make choices.
Now the next three principles relates to how people interact.

1.Trade can make everyone better off:-In simple words trade means exchange of
commodities.So one must do what they are best in and should trade what they are not
able to produce inspite for producing that .
For example:- A farmer producing wheat and a farmer producing rice can exchange
their commodities with each other.
2.Markets are usually a good way to organise economic activity:-Market provides a
platform for exchanging goods and services and also helps in identifying the demand
pattern of the people so that the producers can decide how much commodity is to be
produced and for whom.
3.Government can sometimes improve market outcomes :- This principle is extension
of the recently discussed principle ,Markets are not always a good way of organsing
economic activities so the time when the market is down government plays a major
role and try to improve its current situation.
For example:-externalities, public goods ,equity etc.