ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Traditional Economy. A traditional economy, as the name suggests, is based on a traditional approach. These economies are based on ancient rules and are the most basic type of economy. The focus in a traditional economy is only on the goods and services that match their customs, beliefs, and history.

Detailed explanation-2: -A traditional economy is a system that relies on customs, history, and time-honored believes. Tradition guides economic decisions such as production and distribution. Societies with traditional economies depend on agriculture, fishing, hunting, gathering, or some combination of them.

Detailed explanation-3: -In an traditional economy individuals and tribes make the decisions. Often these decisions are based on customs, traditions, and religious beliefs.

Detailed explanation-4: -Each economy functions based on a unique set of conditions and assumptions. Economic systems can be categorized into four main types: traditional economies, command economies, mixed economies, and market economies.

Detailed explanation-5: -What is Traditional Economics? Traditional economic theory relies on three fundamental assumptions: People are rational. People make decisions based on self-interest. People will change their thoughts and beliefs based on new information.