Functions and importance of statistics in …

Importance of statistics:

1. Formulation of economic laws: it helps in formulation of laws and models e.g. law of demand  has been developed by the inductive method of genralisation which is based on statistical principles.
2. Understanding economic problems: it plays a  vital role in understanding and solving economic problems such as poverty, unemployment, etc.
3. Study of market structures: study of monopoly, monopolistic competition, oligopoly, and monopolistic competition requires statistical comparison of market prices, cost, and profits of individual firms.
4. Intersectoral anf intertemporal  comparison:  statistics helps in the comparision of different sectors of the economy and also helps in comparison of variables in two different time periods
5. Economic forcasting: by using statistical tools , methods, and techniques one can forcast e.g growth of the country in the coming  fiscal year or rate of inflation in the coming month.