2 April 2025

Economy

The economy refers to the system by which goods and services are produced, distributed, and consumed within a society. It encompasses various institutions, relationships, and processes that facilitate the allocation of resources and the management of production and consumption activities. Economies can be classified in various ways, such as by their scale (microeconomics vs. macroeconomics), structure (capitalist vs. socialist), or level of development (developed vs. developing). The functioning of an economy is influenced by factors such as supply and demand, government policies, cultural norms, and external trade relationships. Overall, the economy serves as a framework for understanding how individuals, businesses, and governments interact in the production and exchange of resources to meet needs and wants.