ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -mixed economy, in economics, a market system of resource allocation, commerce, and trade in which free markets coexist with government intervention.

Detailed explanation-2: -Mixed economic systems are not laissez-faire systems, because the government is involved in planning the use of some resources and can exert control over businesses in the private sector. Governments may seek to redistribute wealth by taxing the private sector and by using funds from taxes to promote social objectives.

Detailed explanation-3: -A market economy is a type of economic system where supply and demand regulate the economy, rather than government intervention. A true free market economy is an economy in which all resources are owned by individuals.

Detailed explanation-4: -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-5: -Economists, however, identify six major functions of governments in market economies. Governments provide the legal and social framework, maintain competition, provide public goods and services, redistribute income, correct for externalities, and stabilize the economy.