Economic Environment

scotch Environment of Business| Diploma in potency Management & Administration | Semester V| www.ma16.org 1. sparing agreement Economic system refers to who answers the basic sparing questions of what, how and for whom to produce. What to produce refers to the filling of goods and table operate, how refers to the presidency agency in which the selected good or service is going to be produced and for whom answers how the produced goods ar going to be distributed. Types of Economic bodys: i. Capitalist parsimoniousness (Free Market Economy): * The basic economic questions argon answered by secluded parties; communication channeles decide what to produce and consumers what to buy. * price of the products is determined by the commercialize forces of demand and supply. * Private topographic point is allowed. * Business people induce more interest in setting up business in a melt market economic system. ii. socialist Economy (Command Economy): * The basic economic questions are answered by the g everywherenment or planning self-assurance; the governing decide what to produce. * Price of the products is determined by the government through its rules and regulations. * All property belongs to the government. * Business enterprises are indisposed(p) to invest money in business. iii.

Mixed Economic System: * The basic economic questions are answered by the government in partnership with cloak-and-dagger parties. * close to strategic industries are uncommunicative by government and private investment is not allowed or encouraged in those industries. iv. handed- down Economic System: * mickle produce! goods to satisfy their requirements. * They were self-sufficing economies. * The excess products were exchanged for former(a) goods. 2. Economic Growth It refers to increase in the production of goods and services in a country over a menstruum of time. A country is said to be experiencing economic outgrowth if it produces more goods and services than the previous year. The principal(prenominal) aim...If you want to get a full essay, order it on our website: OrderEssay.net

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