Question

Co-existence of public and private sectors:

• A. Capitalist Economy
• B. Mixed Economy
• C. Socialist Economy
• D. Developed Economy

Hint:

Economic Systems: - Capitalism: Private ownership, profit motive, market mechanism. - Socialism: Social/State ownership, central planning, social welfare. - Mixed Economy: Co-existence of private and public sectors; market mechanism with government regulation and intervention. India is a prime example of a mixed economy. "Developed Economy" is a classification based on development indicators, not the ownership system itself.

Answer 1

The Correct Option is B

Step 1: Define the economic systems based on ownership and control of means of production.
- Capitalist Economy (Market Economy): Means of production are predominantly privately owned and operated for profit.
Economic decisions (what to produce, how to produce, for whom to produce) are primarily determined by market forces (demand and supply).
Limited government intervention.
- Socialist Economy (Command Economy/Centrally Planned Economy): Means of production are predominantly socially owned (usually by the state).
Economic decisions are primarily made by a central planning authority.
Aims for social welfare and equitable distribution.
- Mixed Economy: An economic system that combines elements of both capitalism and socialism.
It features co-existence of private and public sectors.
The government plays a role in regulating the economy, providing public goods and services, and addressing market failures, while allowing for private enterprise and market mechanisms.
- Developed Economy: Refers to a country with a high level of economic development, characterized by high per capita income, advanced industrialization, high Human Development Index (HDI), etc.
It describes a stage of development, not the fundamental system of ownership/control (though most developed economies are mixed, often with a strong market orientation).

Step 2: Identify the system characterized by co-existence of public and private sectors.
The Mixed Economy is defined by the co-existence and interplay of both public (government-owned/controlled) and private sectors.
This matches option (2).