Question

What is meant by the word 'Market'?

Hint:

Market $\neq$ place; it's the process where price is formed by demand and supply.

Answer 1

Modern view: A market is a system of interactions—institutions, rules, and communication channels—linking potential buyers and sellers. It may be local, national, or global and can be physical (bazaar) or virtual (e-commerce, stock exchanges).
Core elements: (i) a commodity/service, (ii) parties willing to trade, (iii) a mechanism for information and payment, and (iv) rules enabling contracts.
Economic role: Markets allocate resources by signaling scarcity through prices; competitive markets foster efficiency, while market failures (externalities, market power, information asymmetry) may justify policy intervention.