22 Questions
In a mixed economy, which sector is characterized by the existence of private property and profit motive?
Private sector
What is the primary objective of industries in the public sector?
Welfare of the community
What is the advantage of mixed economy in terms of resource allocation?
Promotes efficient decisions through price mechanism and competition
Which of the following is a characteristic of a mixed economy?
Existence of private property
What is the role of the government in a mixed economy?
To provide direction and participate in economic activities
What is an advantage of mixed economy over capitalist economy?
Greater economic and social equality and freedom from exploitation
What is the advantage of mixed economy in terms of innovation?
Encourages innovation and technological progress
What is the advantage of mixed economy in terms of consumer sovereignty?
Promotes consumer sovereignty and freedom of choice
In a mixed economy, resource allocation is determined by
both markets and governments
What is a key characteristic of a mixed economy?
Co-existence of private and public sector
What is an advantage of a mixed economy over a socialist economy?
Greater resource efficiency
In a mixed economy, the role of government is to
Regulate and facilitate economic activity
How does a mixed economy differ from a capitalist economy?
More government control in a mixed economy
What is a disadvantage of a socialist economy compared to a mixed economy?
More government control in a socialist economy
In a mixed economy, what is the role of the market?
Play a supplementary role to government
What is a characteristic of the allocation of resources in a mixed economy?
Combination of government and market forces
Which sector is responsible for resource allocation in a mixed economy?
Both public and private sector
What is the primary role of the government in a mixed economy?
To regulate the private sector
What is a key difference between a mixed economy and a capitalist economy?
Role of government in resource allocation
What is an advantage of a mixed economy?
Promotes social welfare
Which characteristic is unique to a mixed economy?
Government intervention in resource allocation
What is used to answer fundamental questions of the economy in a mixed economy?
Cost-benefit analysis
Study Notes
Sectors of Industries in a Mixed Economy
- In a mixed economy, there are three sectors of industries: private, public, and combined sectors.
- Private sector: managed and controlled by private individuals and groups, based on self-interest and profit motive, with a system of private property.
- Public sector: set up by the State for the welfare of the community, not primarily profit-oriented.
- Combined sector: joint venture between the government and private enterprises, producing commodities and services.
Merits of Mixed Economy
- Economic freedom and existence of private property, ensuring incentive to work and capital formation.
- Price mechanism and competition forces promoting efficient decisions and better resource allocation.
- Consumers benefit from sovereignty and freedom of choice.
- Incentives for innovation and technological progress.
- Encourages enterprise and risk-taking.
- Advantages of economic planning and rapid economic development.
- Greater economic and social equality, and freedom from exploitation due to government participation.
- Disadvantages of cut-throat competition averted through government regulations.
Demerits of Socialism
- Predominance of bureaucracy, inefficiency, and delays.
- State direction and control of nearly all economic activity.
- Socialism takes away basic rights, such as the right of private property.
- No incentives for hard work in the form of profit.
- State monopolies created by socialism can become uncontrollable.
- Limited freedom of choice for consumers.
- No importance given to personal efficiency and productivity.
- Labourers are not rewarded according to their efficiency.
Mixed Economy
- Depends on both markets and governments for allocation of resources.
- Coexistence of private and public sectors.
This quiz covers the three sectors of industries in a mixed economy, including private sector, public sector, and their characteristics.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
