Introduction
Market Economy
Market economy is an economy focused around the force of division of work in which the costs of merchandise and administrations are resolved in a free price system set by supply and demand. In market economy, economic decisions and the evaluating of merchandise and administrations are guided exclusively by the aggregate interactions of a country's citizens and organisations, and there is little government intercession or central planning. This is the opposite of a centrally planned economy, in which government decisions drive most aspects of a country’s economy activity (Investopedia, 2009). The United State of America (U.S.A.) is an example of a market economy.
Command Economy
Command economy is an economy where supply and price are regulated by the government rather than market forces. Government planners decide which goods and services are produced and how they are distributed (Investorwords.com, 2014). It is a system where the …show more content…
First characteristic, co-existence of public and private sectors. Mixed economy is actually functioning together with both private sector and public sector. Public sectors controls heavy industries like atomic energy, heavy engineering industries and others. Private sectors controls light industries like consumer goods, agriculture and others. Government helps private sector by providing facilities in order them to develop. Another characteristic, monopoly is controlled by government. Government will reduce monopolies in the economy. Monopoly usually will reduce output and raise prices in order them to have more profits. This will lead inequalities in the country. Government will reduce these “evils” and make those monopolies work in the public interest. Third characteristic, government gives protection to the labor. Labor is protected by the government. Government regulates a minimum wages and working hours, this acts bring lots of benefits to their
Market Economy
Market economy is an economy focused around the force of division of work in which the costs of merchandise and administrations are resolved in a free price system set by supply and demand. In market economy, economic decisions and the evaluating of merchandise and administrations are guided exclusively by the aggregate interactions of a country's citizens and organisations, and there is little government intercession or central planning. This is the opposite of a centrally planned economy, in which government decisions drive most aspects of a country’s economy activity (Investopedia, 2009). The United State of America (U.S.A.) is an example of a market economy.
Command Economy
Command economy is an economy where supply and price are regulated by the government rather than market forces. Government planners decide which goods and services are produced and how they are distributed (Investorwords.com, 2014). It is a system where the …show more content…
First characteristic, co-existence of public and private sectors. Mixed economy is actually functioning together with both private sector and public sector. Public sectors controls heavy industries like atomic energy, heavy engineering industries and others. Private sectors controls light industries like consumer goods, agriculture and others. Government helps private sector by providing facilities in order them to develop. Another characteristic, monopoly is controlled by government. Government will reduce monopolies in the economy. Monopoly usually will reduce output and raise prices in order them to have more profits. This will lead inequalities in the country. Government will reduce these “evils” and make those monopolies work in the public interest. Third characteristic, government gives protection to the labor. Labor is protected by the government. Government regulates a minimum wages and working hours, this acts bring lots of benefits to their