In economic terms, what is a market?

In economic terms, a market is defined as a group of individuals or entities willing to engage in the exchange of goods and services. This definition emphasizes the interaction between buyers and sellers, who come together to negotiate prices and facilitate the transfer of resources. Markets can take various forms, including physical locations like shops and markets, as well as virtual platforms where transactions occur.

The core function of a market is to provide a mechanism through which supply and demand meet, allowing for the determination of price and allocation of resources. This interaction drives economic activity and is fundamental to understanding how economies operate. In essence, a market embodies the concept of voluntary exchange, where parties enter into transactions based on their own preferences and incentives.