Question

How is a market economy different from a mixed economy?

ASAP

Answer 1

A market economy is different from a mixed economy in the following ways:

• A mixed economy combines a free market with central government planning and intervention whereas a market economy relies purely on the free market and the rules of demand and supply, hence.
• In the Market Economy consumers and businesses can take free decisions. Whereas within a Mixed Economy the production and consumption decisions are limited and are influenced by the government.
• A market economy is a laissez-faire economy, whereas a mixed economy is not.
• Goods in a market economy may cater to only a single stratum of the economy, whereas in a Mixed economy, goods cater to different strata of the economy.

Answer 2

Mixed economy is a system of economic organization in which the activities of the private sector are combined with the activities of the public sector, which acts as a regulator and corrector of the former. In a mixed economy, most economic decisions are decided by the interaction of sellers and consumers in the market (supply and demand law). However, the state has an essential complementary role.