Answer to Question #29359 in Economics for Angela

Question

What is the role of business in the economy?

Answer 1

Because we have a capitalistic economy, business is the main component of it. Business
is in every corner of every sector of the market. Most everything you can
possible think of that relates to the economy is business. Retail, services,
agriculture, manufacturing, health care, even political campaigning all
involves business. Even when civilizations were based on an agricultural type
of economy, business transactions occurred.

Without business, humans would have to completely fend for themselves for absolutely everything. We would have to find our own food every single day. We
would have to gather materials to create shelter because there would be no
store to buy them and no real estate agent to sell a house. We would have to
make our own clothes out of fabrics we weaved from raw materials we harvested.
This type of society would not be practical at all. This is why people create
trade with each other. Instead of having to provide ourselves with everything,
we can focus on producing one product or expertise. We can then specialize in
that product or expertise to make it the best on the market and then sell it
for a profit. If everyone else does the same (in theory) we can all trade with
each other and all obtain the best goods and the best knowledge.