Question

7. Which situation indicates a mixed economy?

A Economic activity is controlled entirely by the private sector.
B Individual choices are unaffected by government actions.
C Services are provided by both private and public sectors.
D The government carries out all planning and decision making.​

Answer 1

C Services are provided by both private and public sectors.

Step-by-step explanation:

In a mixed economy, the private sector has the freedom to participate in economic activities, although the government has a role to play. A mixed economy allows the private sector to own the factors of production hence are free to decide what business they wish to run. Consumers have the liberty to select their suppliers. There is competition in the market place as profits motivate entrepreneurs.

The government is involved in the provision of public goods such as roads, hospitals, and schools. It provides regulatory services to the private sector to ensure fairness in the economy.