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Explain any three importances of producers in an economy.

Asked by Topperlearning User 5th June 2015, 9:02 AM
Answered by Expert

Importance of producers is as follows:

  1. Supply of goods and services: Producers are the basis of supply of goods and services in an economy. If there is an increase in the number of producers, then there will be an increase in the supply of goods and services in the market according to the demand of the consumers.
  2. Efficient utilisation of resources: There are limited resources in an economy which can be efficiently utilised in the production process. The producers create demand for various factors of production in their productive activities.
  3. Increase in export earnings: The export earnings of a country would depend upon the number of producers involved in the production of exportable goods. Hence, the volume of export earnings would increase with an increase in number of producers producing export goods.
Answered by Expert 5th June 2015, 11:02 AM
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