Theory question 104
Economic Systems(a) What is an economic system?
(b) Explain any three characteristics of a mixed economic system.
(c) State any two disadvantages of a mixed economic system.
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(a) The way a society organises ownership and use of its resources to answer what, how and for whom to produce.
(b) Any three: both private and public ownership of the means of production; price mechanism works alongside government planning and regulation; profit motive exists with social welfare goals; government provides essential services and controls strategic industries; consumers have freedom of choice within regulations.
(c) Any two: inefficiency and corruption in public enterprises; government controls can discourage private initiative; conflict between public and private sectors; bureaucracy and delays; tax burden to finance the public sector.
A mixed economy combines features of capitalism and socialism.