Economics does not offer any practical methods or techniques for making specific decision matters like buying and selling, deciding levels of production capacities and quantities, or investments for individual firms. But it does offer then useful insights in to various aspects of prices, costs, utility and productivity that improve their overall understanding of the forces and factors that influence the outcome of this decisions. In this way knowledge of economics helps individuals and firms to improve the quality of their many decisions.
However economics offers many useful insights on the collective behavior of people and economies to help governments and other organizations concerned with behavior and performance of economies as a whole. Thus governments and other organizations use knowledge and methods of economics in a more direct way to take decisions on fiscal policies, taxation rates, and other economic regulations.
Economic analysis is also used bu companies that are affected by behavior of economies as a whole. For example, a big company dealing in foreign exchange business is likely to use economic analysis to understand and predict nature of foreign exchange rate fluctuations. Similarly big companies may depend substantially on economic analysis to identify business prospects in future, and take decisions on expansion and diversification based on that.
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