Question

Which of the following statements is false with regard to a mixed economy?

A. Regulations concerning minimum wage standards, social security, environmental protection and the advancement of civil rights may raise the standard of living

B. Ownership of organizations seen as imperative to the nation may be transferred to the state to subsidize costs and allow the firm to flourish

C. Regulations concerning minimum wage standards, social security, environmental protection and the advancement of civil rights ensure that those who are elderly, sick or have limited skills are taken care of

D. Businesses in this model are owned by the state to ensure that investments and practices are done in the best interest of the nation despite the often opposing outcomes

Answer 1

The false statement about a mixed economy is that all businesses are state-owned to ensure investments and practices serve the national interest. In reality, mixed economies have a balance of private business ownership with certain strategic industries being government-run, combining market freedom with government rules.

Step-by-step explanation:

The statement that is false with regard to a mixed economy is that businesses in this model are owned by the state to ensure that investments and practices are done in the best interest of the nation. In a mixed economy, while key industries can be nationalized and controlled by the government, most businesses are privately owned and operate under government regulations. This economic system represents a balance where both market forces and government interventions play roles in the production and distribution of goods and services.

In American countries with mixed economies, the organization of economic institutions is not an either/or choice between market and government, but rather a balancing act that mixes elements of both. This balance aims to harness the efficiencies of the market while ensuring that certain public interests are safeguarded by government oversight or control. Contrary to being fully state-owned, businesses typically have the autonomy to make decisions influenced by consumer demands, with government intervention to correct market failures or to meet social objectives.

Therefore, the incorporation of market freedom and governmental rules is a defining characteristic of a mixed economy, which differentiates it from purely planned or market economies.