Applied economics is the branch of economics that focuses on using economic theories and principles to address real-world issues. It involves analyzing data and applying quantitative methods to understand how economic factors influence decisions in various sectors, such as business, healthcare, and public policy. This field helps policymakers and organizations make informed decisions by evaluating the potential impacts of different strategies. For example, applied economists might study the effects of a new tax policy on consumer behavior or assess the economic benefits of investing in infrastructure projects.