Business Acumen

WHAT IS ECONOMY?

A system of interconnected production, consumption, and trade activities is called an economy. To meet the requirements of persons residing in and participating in the economy, commodities and services are produced, consumed, and distributed.

An economy can stand in for a whole country, a particular region, a specific industry, or even a whole family.

Whether an entity is a country or a small town, an economy includes all of the activities connected to the production, consumption, and trade of products and services in that entity.

Every economy is different. Each is shaped by the resources, laws, cultures, histories, and geographies that are unique to it. Each changes as a result of the individuals' decisions and choices.

TYPES OF ECONOMIES

1) Market-Based Economy:

In "free market" or market-based economies, consumers and businesses can freely exchange products and services based on supply and demand.

2)Common-Based Economy:

Command-based economies rely on a centralised authority that manages the quantity produced, the cost of goods, and their distribution.

3) Mixed Economy:

A system that encloses elements of both capitalism and socialism is called a mixed economy. A mixed economy protects private property and permits some economic freedom in the use of capital, but it also permits government intervention in the economy to further social objectives.

By
M SOHAIB SALEEM