Which term describes the system by which words are constructed from letters?

The term that describes the system by which words are constructed from letters is morphology. Morphology focuses on the structure of words and the rules governing the formation of words through the combination of smaller units of meaning called morphemes. Morphemes can be roots, prefixes, and suffixes, and understanding them is essential for comprehension and production in any language.

For instance, in English, the word "unhappiness" consists of three morphemes: "un-" (a prefix indicating negation), "happy" (the root word), and "-ness" (a suffix that turns an adjective into a noun).

The other terms relate to different aspects of language. Phonetics deals with the sounds of speech, phonology pertains to how sounds function in particular languages, and syntax involves the rules of sentence structure and how words are arranged to form phrases and sentences. Understanding the distinctions between these areas helps in the study of language and its components.