ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A market economy is an economic system where two forces, known as supply and demand, direct the production of goods and services. Market economies are not controlled by a central authority (like a government) and are instead based on voluntary exchange.

Detailed explanation-2: -Answer and Explanation: An Economic system in which decisions on production and consumption of goods and services are based on voluntary exchange in markets is best referred to as a market economy. In a market economy, the forces of supply and demand control how products and services are produced.

Detailed explanation-3: -Traditional Economy: A system which families, clans, or tribes make economic decisions based on customs and beliefs that have been handed down from generation to generation.

Detailed explanation-4: -Capitalism is often thought of as an economic system in which private actors own and control property in accord with their interests, and demand and supply freely set prices in markets in a way that can serve the best interests of society.

Detailed explanation-5: -Each economy functions based on a unique set of conditions and assumptions. Economic systems can be categorized into four main types: traditional economies, command economies, mixed economies, and market economies.