ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -An economic system is any system of allocating scarce resources. Economic systems answer three basic questions: what will be produced, how will it be produced, and how will the output society produces be distributed?

Detailed explanation-2: -In a pure command economy, the basic economic questions are answered by the government, which owns the productive resources and handles distribution of goods and services.

Detailed explanation-3: -This helps to understand which good or services are required in the society (what to produce?) with which technique these are to be made (how to produce?) and who would consume these goods( for whom to produce?).

Detailed explanation-4: -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.