Private consumption refers to the total amount of goods and services purchased by households and individuals within an economy. It includes everyday expenses such as food, clothing, housing, and entertainment. This spending is a key component of economic activity, as it drives demand for products and services. The level of private consumption can be influenced by various factors, including income levels, consumer confidence, and interest rates. When people feel secure in their jobs and finances, they are more likely to spend money, which can stimulate economic growth. Conversely, during economic downturns, private consumption may decline as households cut back on spending.