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| BASIS FOR COMPARISON | ECONOMICS | ECONOMY |
| Meaning | Economics is the science and art of decison making, regarding the use of scarce resources, under the conditions of scarcity, to attain maximum satisfaction. | When a country or a geographical region is defined in the context of its economic activities, it is known as economy or economic system. |
| What is it? | Theory and Principle | Practical Application of Economics |
| Determines | How human beings make decisions when there is scarcity of resources? | How resources are allocated among different members of society? |
| Focuses on | The way in which economic agents behave and interact and the way in which economies work. | The way in which country's economic affairs are organized and conducted. |

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