Education and Career Forum

what is economy?what are central problems of economy and explain it?

Originally Posted by kundan mehra

what is economy?what are central problems of economy and explain it?

What is Economy -

Economy May be defined as many ways, Activities Related to the Production and Distribution of goods and services in a particular Geographic Region and the Correct and effective use of Available Resources. So, Economy is a Social System Or Network Where People And the Firms they Create Exchange Goods and Services

What are the central problems of an economy -

These given problems are known as the central problems or the basic problems of an economy -

- What to produce - Means, which goods should be produced, and secondly, what should be the quantities of the goods that are to be produced

- How to produce - Second problem arise, which technique should be used for production because there are various techniques available for the production of a commodity like use more of labour and less of capital or less of labour or more of capital.

- For whom to produce - Next problem was arise that for which section and society, the good was produced, The allocation of scarce resources and the distribution of the final goods and services are the central problems of any economy.

Other Problems -

- The problem of efficient use of resources.

- The problem of fuller employment of resources.

- The Problem of Growth.

There are lots of ways to define Economy, i think shortest is mentioned below, alongwith its central problem:

Economy means the financial and industrial system of a country.

The central problem in the economy is that money is not circulating among normal people. It is flowing up to the richest as fast as the government can print it. If we are to climb out of this mess, wealth needs to flow back into the hands of middle class consumers who will spend it.

conclusion of central problems of an economy

i want to know the problem for whom to produce on the basis of personnel and on the basis of function

What are the basic problem of an economic system and how do they arise from problem of scarcity?

Conclusion for central problems of economy

Distinguish between extension of demand and increase in demand?