To understand how financial system and markets are organized, structured and operate, we need to familiarize ourselves with the basic economic principals and concepts that are governing this subject. These basic economic principals are:-1- individual annual income-2 Consumption 3-investment and return on investment- 4- inflation -5 investment risk, both systematic and non-systematic. Chose three of these principles and explain what your understanding of each one is and why they are important to students of financial markets.