Production, Distribution, and Consumption

• Production - is the creation of goods made out of raw materials.

• Distribution - is, like its name states, the act of distributing the goods produced to the public. The share that they receive varies in accordance to their position in the economic standing, and the amount they paid for the said product.

• Consumption - is the usage of the said good or product

These three rely on one another, and one would be useless without the other two. Together, they make up the famous economic cycle (P, D, C). The materials produced are based on what and how much is needed to be consumed, while distribution relies on the amount of goods produced. Lastly, consumption is based on the part that they receive during the distribution of the goods and services, unable to consume/use more than they have.

A shortage on one would cause the other to fall as well, and an increase in one will result into a much higher demand on the other. Each is just as important as the other.