Final answer:
An economic system is the organized way a society manages the production, distribution, and consumption of goods and services, finding solutions to essential economic questions.
Step-by-step explanation:
The structure of methods and principles that society uses to produce and distribute goods and services is known as an economic system. An economic system includes processes created to manage the production, consumption, and distribution of goods and services. Fundamental elements of an economic system involve the factors of production, which include land, labor, capital, and entrepreneurship. These systems determine how a society answers essential questions like "what to produce?", "how to produce?", and "For whom to produce?". The circular flow model helps in visualizing these economic interactions, illustrating the exchanges in the factor and product markets.