ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A true free market economy is an economy in which all resources are owned by individuals. The decisions about the allocation of those resources are made by individuals without government intervention.

Detailed explanation-2: -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-3: -The characteristics of a market economy include: The economic system relies on demand and supply. The quantity produced of a good or service is determined by the demand and supply. There are four types of economies, namely, traditional, command, market, and mixed economies.

Detailed explanation-4: -There are three main types of economies: free market, command, and mixed. The chart below compares free-market and command economies; mixed economies are a combination of the two.

Detailed explanation-5: -A market economy is an economic system in which economic decisions and the pricing of goods and services are guided by the interactions of a country’s individual citizens and businesses.