What are the basic methods of analysis used by Economists? Briefly and convincely discuss each of them. ANSWER: Economics like every other sciences, employs two essential methods in its investigations and formulation of law and principles. The two methods includes: 1.Deductive method 2. Inductive method DEDUCTIVE METHOD Deductive method is a method of economic analysis that involves the use of logical reasoning to arrive at a conclusion using formal data and assumptions. This method provides us with generalizations and hypotheses.We have valid economic laws if the hypotheses are tested and verified with relevance to facts. A complete form of deductive method consist of three stages, viz 1. Observation 2. Deductive reasoning 3. Instance and testing by means of further observation. INDUCTIVE METHOD The inductive method is sometimes similar to the deductive method. The only thing that differentiates them is that induction uses econometric packages i.e E-views and STATA to run experi