sectors of economy

04/10/2023 SHEIK NOWHEED 1

Sheik Mohammed Nowheed

Iind sem MBA,

SIT Mangalore


• an open economy is an economy in which there economic activities done between domestic community & outside.

• Open economy is the economy activity done all over the world.


• (i) It neither exports goods and services to the foreign countries nor imports goods and services from the foreign countries

• ii) It buys shares, debentures, bonds etc. from foreign countries &sells shares, debentures, bonds etc. to foreign countries

Functions of Open Economy


• (iii) It borrows from the foreign countries & lends to the foreign countries

• (iv) It receives gifts from foreigners & sends gifts to foreigners

• (v) Normal residents of a open economy can go to other countries to work in their domestic territory & also foreigner is allowed to work in the domestic territory of a open economy


Merits of Open Economy• Great Choice for consumers

• Increased competition

• Lower price and quality products

• Gains From Trade

• Increased export & import

• Expanded markets


• Closed economy is an economy, which does not have any sort of economic relation with rest of the world.

• There is no closed economy in today's world

• A closed economy does not enter into any one of the following activities


Functions of Closed Economy

(i) It neither exports goods and services to the foreign countries nor imports goods and services from the foreign countries

(ii) It neither buys shares, debentures, bonds etc. from foreign countries nor sells shares, debentures, bonds etc. to foreign countries


• (iii) It neither borrows from the foreign countries nor lends to the foreign countries

• (iv) It neither receives gifts from foreigners nor sends gifts to foreigners

• (v) Normal residents of a closed economy cannot go to other countries to work in their domestic territory. No foreigner is allowed to work in the domestic territory of a closed economy


Sector Of The Economy

Primary sector

Secondary sector

Tertiary sector


Primary Sector• The primary sector includes the production of raw

material and basic foods

• Activities associated with the primary sector include agriculture, mining, forestry, farming, grazing, hunting and gathering, fishing, and quarrying


• The packaging and processing of the raw material associated with this sector is also considered to be part of this sector

• In developed and developing countries, a decreasing proportion of workers are involved in the primary sector

• Agriculture in India is the major sector of its economy account 18% of the GDP

• It provides employment to 60% of the country’s total population

• About 43% of the country’s total geographical area is used for agricultural purposes


Primary Sector

• Among other things, the government also tried to decrease the dependence on monsoons

• Better seeds, use of fertilizer, education of farmers and provision of agricultural credit and subsidies are reasons for increase in agricultural productivity


• major producer of milk, cashew nuts, coconuts, tea, ginger, turmeric and black pepper in the whole world

• It is the second largest producer of wheat, sugar, groundnut and inland fish

• It is the third largest producer of tobacco and rice

• India accounts for 10 per cent of the world fruit production with first rank in the production of banana and sapota


Example of Primary Sector

Agriculture


Forestry


FISHING:


Secondary Sector

• The secondary sector of the economy or industrial sector includes those economic sectors that create a finished, tangible product: production and construction

• All of manufacturing, processing, and construction lies within the secondary sector


• Activities associated with the secondary sector include metal working and smelting, automobile production, textile production, chemical and engineering industries, aerospace manufacturing, energy utilities, breweries and bottlers, construction, and shipbuilding

• This sector generally takes the output of the primary sector and manufactures finished goods

• gives employment to 17% of the total workforce

• The government aims at achieving self-sufficiency in production and protection from foreign competition


• These products are then either exported or sold to domestic consumers and to places where they are suitable for use by other businesses

• This sector is often divided into light industry and heavy industry

• Many of these industries consume large quantities of energy and require factories and machinery to convert the raw materials into goods and products

• They also produce waste materials and waste heat that may pose environmental problems or cause pollution.

• industrial sector accounts for 27.6% of the GDP


Example of Secondary sector

Manufacturing

Electricity


Construction

Water supply


Gas supply

Mining & Quarrying


Tertiary Sector

• The tertiary sector of the economy is the service industry

• it holds the highest importance among all sectors • This sector provides services to the general

population and to businesses


• Activities associated with this sector include retail and wholesale sales, transportation and distribution, entertainment, restaurants, clerical services, media, tourism, insurance, banking, healthcare, and law.

• In the U.S., more than 80% of the labor force are tertiary workers

• In most developed and developing countries, a growing proportion of workers are devoted to the tertiary sector


• the tertiary sectors account for 51% of the GDP.

• India is the fifteenth largest country in the world in terms of services' output

• This sector provides employment to 23% of the workforce and is the fastest growing sector,


Example of tertiary sector

Banking &

Finance


Personal Services ID- Services

Insurance


Transport

Real Estates

sectors of economy

Economy & Finance

sheik nowheed

major sector

primary sector agriculture

economy account

economy activity

industrial sector accounts

foreign competition

functions of closed