economy
Definition
An economy encompasses all activities related to production, distribution, and consumption of goods and services within a society. It outlines how resources are allocated, jobs are created, and how wealth circulates among individuals and businesses.
Analogy
Think of the economy as a vast network of roads in a city. Just as roads connect various parts of a city facilitating the movement of vehicles and people, the economy connects different sectors (like agriculture, industry, services) facilitating the flow of money, products, and services.
Related terms
Market: A system where buyers and sellers interact to exchange goods and services for money, often determining prices through supply and demand.
Capitalism: An economic system where private individuals rather than the state own and control property and businesses, operating for profit in competitive markets.
Labor Force: The total number of people employed or seeking employment in an economy at any given time
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