IGCSE Economics Paper-2: Specimen Questions with Answers 73 - 74 of 100

Passage

“The private sector, this includes reports such a corporate social responsibility reports, responsibility reports or environmental reports. For the public sector, this includes reports such as sustainability reports/plans, state of environment (SOE) reports, or strategic plans.”

Question 73 (2 of 5 Based on Passage)

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Short Answer▾

With examples explain the difference between the private sector and public sector.

Explanation

  • Public sector refers to a government-owned organization, and government-provided services. Private sector on the other hand refers to organizations that are not owned by the government and the goods and services are provided by organizations outside of the government control.
  • Example of public sector: The public sector is government (national and local) . Job of a doctor, civil servants, police, and teacher etc. comes under public sector. Example of private sector- Companies owned by individuals is part of the private sector. The largest corporation with its common stock publicly-traded on the New York Stock Exchange is part of the private sector, the private sector is private enterprises – retail, manufacturing, local services.
Direct and Indirect Taxes

Question 74 (3 of 5 Based on Passage)

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Distinguish between mixed economy and market economy

Explanation

  • Mixed economic system is the economic system where it is not a wholly state-owned economy, i.e.. the government does not own all the means of production private sector also has a hold on the production. A mixed economic system is an economy where private ownership is allowed and businessmen and consumers can freely use capital. However, in a mixed economy, government has certain amount of intervene by regulating the economy in the interest of public.
  • In contrast, pure capitalist or a market economy is a free economic system which allows competing and voluntary private businessman to make plan, carry on production, and trade without any involvement of the government. The amount of production and the price of goods and services are determined by the forces of supply and demand. As a result, capitalism is often called as a market economy.

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