How The Economy Works
How The Economy Works How The Economy Works Introduction The economy is the system that allows society to function, and how an economy works can be a complicated subject. The type of economy you live under will greatly impact your life. For example, if you live in a command economy like Cuba or North Korea, government officials tell you what to do with your money and all business is controlled by the state. In contrast, countries like Australia or Germany have market economies where individuals can spend their money however they want and private companies decide what products are made based on supply and demand. However, all economies share some common features: buyers and sellers who exchange goods for money; prices that fluctuate based on supply and demand; money as an intermediary between buyers who don't want chickens or tomatoes right now but would rather wait until later when they need it more desperately; inflation (rising prices) due to increased demand without enoug...
