Economy – Basics
Economy is a system of multiple functions like production, manufacturing, distribution and consumption of goods & services amongst various segment of population. It is affected by market movements like inflation and recession. It is impacted by natural calamities and sudden changes in the geography. Some of the prime parties or entities of any economy are consumers which are the public or end users, producers who manufacture the products and suppliers who act as middlemen between producers and consumers. Demand of any goods or services would be determined by consumers. At the same time purchasing power of consumers is equally important in any economy. This indicates that consumer’s income and expenditure both are involved in economical evolution.
Producers or manufacturers are key players of an economy as they provide required products and services in the market. Producers have to do a detailed research around market segmentation. Products are designed basis the different segments of market. Geographical location of a market impacts the market segment to a great extent. Market segmentation is done basis the geography, income, age, sex and even taste of the user population. Amount allocated for expenditure is quantified before developing a product for any type of market.
Stock & Stock Market
Economy works on stock market to a larger extent. Stock market is a virtual arrangement of physical buyers and sellers for the purpose of trading. Stock market facilitates exchange and buying & selling. This could be done through brokers in the stock market who are purely the specialists at stock exchange. Stock market does not restrict small traders to trade through this exchange.
Measures Of Economy
Measure of economy varies from one country to another and from one economy to another. However there are some of the basic measures prevalent in almost all economies like GDP. Globally GDP is identified as one of the most accurate and correct measure of any economy. GDP by and large determines the overall quality of life in a given country. Numerically it’s a total evaluation of production of goods & services in a financial year in an economy. Similarly employment status indicates the economical evaluation of any country. Purchasing power or ability to spend is directly linked with income and wages. Therefore the better employment an economy has the better would be the economic condition of that country. Rate of exchange and rate of interest are also used as measures of economy by the economists.