GENERAL KNOWLEDGE

Detailed explanation-1: -Political economy or economics is a study of mankind in the ordinary business of life; it examines that part of individual and social action which is most closely connected with the attainment and with the use of the material requisites of wellbeing.

Detailed explanation-2: -According to Alfred Marshall, economics is the study of man in the ordinary business of life.

Detailed explanation-3: -Marshall’s theory of capital was designed to serve two main purposes: an integration of the theory of income distribution into a general theory of value and the closing of the gap between economic theory and business practice.

Detailed explanation-4: -A difference between the two economists may be that Smiths arguments mainly revolve around specialisation and division of labour whereas Marshall focuses on the decision of individuals and supply and demand.