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Geography: The Human and Physical World1st EditionRichard G. Boehm 1,403 solutions A primary economic activity refers to any kind of economic activity that involves collecting, extracting or harvesting natural resources. There are two types of products that can be produced from primary economic activities.
Before learning more about primary economic activity, you will have to first understand the meaning of the term ‘economic activity’. Economic Activity: Meaning and TypesAll activities involved in the exchange of money or production of goods and services that satisfy some or all the needs of consumers are considered economic activities. Typically, there are three types of economic activities:
Company P is engaged in the mining and extraction of iron ore from mines in the state of Minnesota. The company uses a combination of technology and manpower to perform this activity. Since the core activity is the extraction of a natural resource, we can classify Company P to be engaged in a primary economic activity. Company S is a steel manufacturer in Minnesota. Since iron is the primary raw material required to make steel (along with carbon), Company S purchases large quantities of iron from Company P. Here, Company P’s primary output is being used as an input to manufacture Company S’s main output. Therefore, Company S is engaged in a secondary economic activity. Company T is a banking company which finances major industries and businesses. Both Company P and Company S have a line of credit from Company T to carry on their primary activities of iron ore extraction and steel manufacturing respectively. Since Company T’s business activity involves financially supporting the smooth running of the businesses of Company P & Company S, Company T is said to be involved in a tertiary economic activity. Primary Economic Activity: Industry ClassificationWe can use The North American Industry Classification System (NAICS) to classify the following industries and their products as primary sector industries:
Primary Economic Activity AnalysisPrimary economic activities are vital not only for the economy but also for the sustenance of the human race. One can even say that primary economic activities form the ‘building block’ of other economic activities. Whether it be agricultural or animal products, crude oil extraction or coal mining, the world has come to depend on these essential commodities on an ongoing basis. It is estimated that around 40% of the world’s workforce is employed in some form of primary economic activity. Unfortunately, the percentage of the world’s population involved in these activities has been reducing gradually over the years. These activities are now mostly confined to under-developed or developing countries where a majority of the population live in rural areas and come from low-income backgrounds. The developed countries have moved up the value chain and are focusing mostly on tertiary economic activities such as the services sector. Unlike primary economic activities that utilize more land or other natural resources but produce less wealth, the services sector generates the most wealth. But all said and done, economic growth depends on the sustenance and co-dependence of all the three types of economic activities. While primary economic activities act as the building block for secondary and tertiary sectors, the primary sector needs the expertise of the secondary and tertiary sectors to improve its productivity and performance. The mutual interaction and relationship among the different economic activities are crucial for the sustenance and growth of the world’s economy. Primary Economic Activity ConclusionTo sum up:
FAQs1. What is a primary economic activity?A primary economic activity refers to an activity that involves the collection, extraction, or harvesting of natural resources. 2. What are the 3 main primary economic activities?The three (3) types of economic activities are: primary, secondary, and tertiary.
3. What are examples of primary economic activities?Common examples of primary economic activities include agricultural and animal products, forestry and logging, mining, oil, and gas extraction. 4. What are the characteristics of primary economic activities?The main characteristics of primary economic activities are that they use more land and other natural resources, but produce less wealth. 5. What are the industry classifications of primary economic activity?Primary economic activities are classified under the NAICS 11 and 21 categories.
Which type of economic activities are most people engaged in a developed country?There are 4 types of activity in a country's economy: primary, secondary, tertiary and quaternary. The more developed countries are dominated by tertiary and quaternary economic activity, whereas less developed countries are dominated by primary and secondary economic activity.
Which economic sector of the economy is made up of people who perform a service like a salesperson or teacher?The tertiary sector of the economy, generally known as the service sector, is the third of the three economic sectors in the three-sector model (also known as the economic cycle). The others are the primary sector (raw materials) and the secondary sector (manufacturing).
Which factor is the best indicator of the wealth of a nation?Economists and politicians across the globe use Gross Domestic Product (GDP) as the ultimate yardstick for measuring and ranking countries' wealth.
How has the spread of manufacturing to developing countries changed their patterns of settlement?How has the spread of manufacturing to developing countries changed their patterns of settlement? Population has shifted from cities to smaller villages where residents engage in cottage industries. Population has become distributed more evenly as urban workers seek free land.
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