Exploitation means using things that are available in order to benefit from it. It is usually used in a bad sense, although it can be used in a good sense as well.
If a person exploits a situation it means that they realize that they can use it to do something which will be good for them. Very often this also means that it will be bad for other people. So the first person exploits the situation and also exploits the other people.
People, especially proletariat or unskilled workers, can be exploited through a sweatshop. This means that someone else uses the people's knowledge or skills in order to make them do something for them. Socialists (or communists) often talked about the "exploitation of the masses" when they were saying that Capitalism was bad. They meant that a few rich people were using all the working people to do hard work for them but paying them very little. The employers then sold the products for more money and kept the extra as profits so that they themselves could become rich.
Exploiting people still goes on today.
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