Question

An economy encompasses ______.

Options

• activities related to production only

• activities related to consumption only

• trade of goods and services only

• all economic activities

Answer 1

An economy encompasses all economic activities.

Explanation:

An economy is a comprehensive framework that includes all types of economic activities, including production, consumption, trade and exchange of goods and services. It is not limited to just production, consumption or trade alone but includes all these and more within its scope. Hence, all economic activities because an economy covers the entire spectrum of economic interactions within a region or country.