Question

What does the economy produce?

• A. Goods
• B. Services
• C. Profit
• D. Both (A) and (B)

Hint:

An economy produces both goods (tangible products) and services (intangible offerings) to meet the needs of consumers.

Answer 1

The Correct Option is D

Step 1: Understanding what an economy produces.
An economy primarily produces goods and services, which are essential for satisfying the needs and wants of consumers.

Step 2: Analyzing the options.
(A) Goods: This is correct, as an economy produces various goods like food, clothing, and machinery.
(B) Services: This is also correct, as an economy also produces services like healthcare, education, and entertainment.
(C) Profit: While profit is a goal of businesses in an economy, it is not something directly produced by the economy.
(D) Both (A) and (B): Correct. An economy produces both goods and services to meet the needs of its people.

Step 3: Conclusion.
The correct answer is (D) Both (A) and (B), as the economy produces both goods and services.