Economy

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DEFINITION of 'Economy'

The large set of inter-related economic production and consumption activities which aid in determining how scarce resources are allocated.

INVESTOPEDIA EXPLAINS 'Economy'

The economy encompasses everything related to the production and consumption of goods and services in an area.

The economy and the factors affecting the economy have spawned one of the largest fields of study in human history - economics. The study of economics can be broken into two major areas of focus, microeconomics and macroeconomics.

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  5. What is the difference between structural unemployment and cyclical unemployment?

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  6. How does automated work affect structural unemployment rates?

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  7. Is the substitution effect negative for consumers?

    The substitution effect is both positive and negative for consumers. It is positive for consumers because it means that they ... Read Full Answer >>
  8. What is the difference between frictional unemployment and structural unemployment?

    Structural unemployment and frictional unemployment are two different types of unemployment that occur in an economy. Frictional ... Read Full Answer >>
  9. What countries contribute the largest weight to the global electronics sector?

    As of 2015, China, the United States and Germany are at the front of the pack in producing electronics on a global level. ... Read Full Answer >>
  10. What is the aerospace sector?

    The aerospace sector, one of the largest and most powerful industries in the United States, supplies five markets: military ... Read Full Answer >>
  11. How is an economy formed and why does it grow?

    Broadly speaking, an economy is an inter-related system of human labor, exchange and consumption. An economy forms naturally ... Read Full Answer >>
  12. What is the difference between inflation and stagflation?

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  13. How do government-issued stimulus checks affect the economy?

    Stimulus checks are payments given to individuals by the government based on taxes paid in the previous year. The hope is ... Read Full Answer >>
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