explain the various types of economy plz answer fast tomorrow exam
Answers
A traditional economic system is the best place to start because it is, quite literally, the most traditional and ancient type of economy in the world. There are certain elements of a traditional economy that those in more advanced economies, such as Mixed, would like to see return to prominence.2. Command Economic System
In terms of economic advancement, the command economic system is the next step up from a traditional economy. This by no means indicates that it is fairer or an exact improvement; there are many things fundamentally wrong with a command economy.3. Market Economic System
A market economy is very similar to a free market. The government does not control vital resources, valuable goods or any other major segment of the economy. In this way, organizations run by the people determine how the economy runs, how supply is generated, what demands are necessary, etc.A mixed economic system (also known as a Dual Economy) is just like it sounds (a combination of economic systems), but it primarily refers to a mixture of a market and command economy (for obvious reasons, a traditional economy does not typically mix well). As you can imagine, many variations exist, with some mixed economies being primarily free markets and others being strongly controlled by the government.
Explanation:
An economic system is a mechanism with the help of which the government’s plan and allocate accessible services, resources, and commodities across the country. Economic systems manage elements of production, combining wealth, labour, physical resources, and business people. An economic system incorporates many companies, agencies, objects, models, as well as for deciding procedures.
Types of Economic System
Capitalist Economy- In a capitalist system, the products manufactured are divided among people not according to what people want but on the foundation of Purchasing Power—which is the ability to buy products and services. Which means an individual needs to have the money with him to buy the goods and services. The Low-cost housing for the underprivileged is much required but will not include as demand in the market because the needy do not have the buying power to back the demand. Therefore, the commodity will not be manufactured and provided as per market forces.
Socialist Economy- This economy system acknowledges the three inquiries in a different way. In a socialist society, the government determines what products are to be manufactured in accordance with the requirements of society. It is believed that the government understands what is appropriate for the citizen of the country, therefore, the passions of individual buyers are not given much attention. The government concludes how products are to be created and how the product should be disposed of. In principle, sharing under socialism is assumed to be based on what an individual need and not what they can buy. A socialist system does not have a separate estate because everything is controlled by the government.
Mixed Economic – Mixed systems have characteristics of both the command and market economic systems. For this purpose, the mixed economic systems are also called as dual economic systems. However, there is no sincere method to determine a mixed system. Sometimes, the word represents a market system beneath the strict administrative control in certain sections of the economy.
Economic Sector
The economic sector is divided into three economic sectors
Primary Sector: It is that sector which relies on the environment for any production or manufacturing. Few examples of the primary sector are mining, farming, agriculture, fishing, etc.
Secondary Sector: In this sector, the raw material is transferred to a valuable product. Few examples are construction industries and Manufacturing of Steel, etc.
Tertiary Sector: It is also known as Service Sector, and includes production and exchange of services. Few examples are banking, insurance, transportation, communication, etc.
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