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Crap Essay

862 words - 4 pages

Market economic system | features, advantages and disadvantages
[pic][pic]Market Economic System
The central thought of this system is that it should be the producers and consumers who decide how to utilise the resources. Thus, the market forces decide what to produce, how much to produce and for whom to produce.
• All resources are privately owned by people and firms.
• Profit is the main motive of all businesses.
• There is no government interference in the business activities.
• Producers are free to produce what they want, how much they want and for whom they want to produce.
• Consumers are free to choose.
• Prices are decided by the ...view middle of the document...

• Consumption of harmful goods may be encouraged: Free market economy might find it profitable to provide goods which are in demand and ignore the fact that they might be harmful for the society.
• Ignore Social cost: In the desire to maximise profits businesses might not consider the social effects of their actions.

Advantages and Disadvantages of Mixed Economy

[pic][pic]Mixed economy as the name suggests is an economy where all the activities related to production and other activities are carried out by participation of both government and private enterprises. Given below are some of the advantages and disadvantages of mixed economy –
Advantages of Mixed Economy
1. Since mixed economy involves both government and private enterprises it has the advantage of taking the benefits of capitalist nature of private companies and socialist nature of government.
2. There is less inequality of income because intent of government is to have a balanced economic growth of an economy.
3. Mixed economy allows individuals to run their business and make profits but at the same time it places some responsibility on these companies by inducing them to contribute towards the welfare of society.
Disadvantages of Mixed Economy
1. Since welfare of society is important in a mixed economy it leads to lower than optimum use of the resources because government mobilize the resources towards the production of those goods and services which are beneficial for the society as a whole rather than producing those goods and services which in economic terms are more beneficial for an economy.
2. Under mixed economy private enterprises have to face lot of difficulty because of various...

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