An economy centered on services and knowledge-based tasks is described by which term?

• A. Knowledge based economy
• B. Service based work
• C. Industrial Economy
• D. Agricultural Economy

Answer: (A)

Value in this type of economy comes from knowledge, ideas, and information, not just physical products. When services are driven by expertise, research, design, and high-skilled problem solving, the economy is described as knowledge-based. This sets it apart from an industrial economy, which centers on manufacturing; from an agricultural economy, which centers on farming; and from a generic service-based economy, which may include various services but not necessarily a heavy emphasis on knowledge and innovation. In knowledge-based economies, the main engines are human capital, innovation, and information technologies, with activities like software development, consulting, education, research, and advanced financial services shaping growth.