ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -In market economies, there is private ownership of resources-established though property rights-and the factors of production and consumption are all coordinated through markets.

Detailed explanation-2: -Command economy relies on government officials to answer the three basic economic questions. Officials called – central planners/ decide on what will be produced and made. Individuals have little or no say in economic choices. Command economies don’t exist.

Detailed explanation-3: -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-4: -Economists address these three questions: (1) What goods and services should be produced to meet consumer needs? (2) How should they be produced, and who should produce them? (3) Who should receive goods and services? The answers to these questions depend on a country’s economic system.

Detailed explanation-5: -In a command economy, what goods and services are produced, how they are produced, and for whom they are produced are all questions answered by government planning. The government makes economic decisions for the good of society.