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What is economic activity? Explanations

by Zafar Iqbal
October 17, 2022
in Business
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What is economic activity

What is economic activity

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What is economic activity? Economic activity is a collection of acts that involve monetary transactions to create, trade, sell, or distribute products or services. Economic activity is a collection of similar efforts that supply goods or services to institutions or end users.

What Does Economic Activity Mean?

Economic activities differ from non-economic activities because the former are quantified in terms of the money earned in transactions. At the same time, the latter does not involve any money. When a country’s economic activity rises, it produces more money and allows for economic growth. There are several ways to conduct economic activity. A person can function as a professional, indicating that he delivers a service and gets compensated based on his expertise.

Others work as employees, providing labor to an employer for pay. Other examples are companies, which are for-profit organizations.

Finally, economic activity can be classed as primary if it is directly tied to agriculture, forestry, or other natural resources; secondary if it is related to manufacturing, processing, or building; and tertiary if it is a service.

Example

The new Major wants to know if the economy is expanding in a little city in an Asian country. He knows that there are more businesses and shopping malls now than a decade ago, so he engaged an expert to account for economic activity. The city economy is mostly formed by tourism. Hence tertiary activities such as restaurants and merchants are the most significant. There are also small farms, primary operations, and a few manufacturing enterprises operating in the secondary sector.

They all labor to produce money. Thus the total amount of money created in a certain period was totaled to gauge the economy. Every year, the economy was measured, and economic growth could be estimated. The Major verified that the economy was booming but also had some fascinating new discoveries.

For example, he noticed that farming was slowly dropping while retailing was booming. This was extremely beneficial to him since it allowed the municipality to implement initiatives to improve the status of agricultural facilities inside the city.

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thewebgenic.com
Zafar Iqbal

Zafar Iqbal

Zafar Iqbal is the CEO of Thewebgenic and SEO expert. Before starting Thewebgenic he was a digital marketing consultant who works with brands to develop and produce results from quantitative research on consumer behaviour. Zafar Iqbal is an avid creative writer and blogger. He is a regular contributor to numerous blogs and online magazines, where he writes about Technology (his speciality!), health, and many other topics. Zafar’s goal is to create interesting and compelling content and then share it online.

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