Question
Distinguish between capitalist economy and mixed economy.
| Basis | Capitalist Economy | Mixed Economy |
| 1. Ownership | Means of production are owned and managed by private people. | Means of production are owned by the government as well as by private people. |
| 2. Motive | Economic activities are guided by self-interest and profit motive. | Economic activities of enterprises are guided by both social motive and profit. |
| 3. Solution of Central Problems | All central problems are solved with the help of price mechanism. | Price mechanism and economic planning both are at work simultaneously. |
| 4. Nature of Occupation | People are free to start any type of business of their own choice. | Freedom under government control. |
| 5. Competition | There is free competition in all fields of production. | There is low degree of competition |
| 6. Consumer's Sovereignty | Consumers are completely free to buy goods of their choice. | 'Consumers' freedom is limited. |
| 7. Distribution of Income | There is the existence of large inequalities of income. | Income inequalities are there. But national income is not highly unequal. |
| 8. Economic Fluctuation | Economic fluctuations are widely seen. | Economic fluctuations are found here. |
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