<P> There are multiple components to economic system. Decision - making structures of an economy determine the use of economic inputs (the factors of production), distribution of output, the level of centralization in decision - making, and who makes these decisions . Decisions might be carried out by industrial councils, by a government agency, or by private owners . </P> <P> An economic system is a system of production, resource allocation, exchange, and distribution of goods and services in a society or a given geographic area </P> <P> In one view, every economic system represents an attempt to solve three fundamental and interdependent problems: </P> <Ul> <Li> What goods and services shall be produced, and in what quantities? </Li> <Li> How shall goods and services be produced? That is, by whom and with what resources and technologies? </Li> <Li> For whom shall goods and services be produced? That is, who is to enjoy the benefits of the goods and services and how is the total product to be distributed among individuals and groups in the society? </Li> </Ul>

The three main economic questions can be categorized as