ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A mixed economic system is a system that combines aspects of both capitalism and socialism. A mixed economic system protects private property and allows a level of economic freedom in the use of capital, but also allows for governments to interfere in economic activities in order to achieve social aims.

Detailed explanation-2: -The mixed economic system is defined as an economic system that combines the elements of a market economy and the elements of a planned economy. It is a synthesis of socialism and capitalism, which contains both private enterprises and public enterprises.

Detailed explanation-3: -Whenever government interferes in market prices, catallaxy is distorted, causing misallocations of resources and deadweight losses. Despite their best intentions, mixed economies are a burden on the price mechanism.

Detailed explanation-4: -Mixed economies work to the degree that they embrace democracy. There is always some degree of government involvement in a mixed economy. Communist countries like North Korea and Cuba are examples of mixed economies.

Detailed explanation-5: -Pillars of capitalism In free markets, also called laissez-faire economies, markets operate with little or no regulation.