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Difficulty: MediumMixed Economy

In a mixed economic system, statutory regulatory agencies can modify market outcomes through taxation and legislation without abolishing private ownership of the means of production.

Answer: Answer

Answer

The statement is TRUE. A mixed economy relies on the co-existence of private enterprise and public control, allowing government agencies to regulate market decisions without eliminating private property rights.
The statement is true because mixed economies maintain dual ownership structures. Private individuals own factors of production and respond to market incentives, while government agencies intervene using policy measures and regulations to promote public welfare without revoking private ownership rights.

Step-by-Step Solution

1
Identify the structural arrangement of a mixed economic system
A mixed economy combines private sector initiative with government public sector participation and oversight.
Understanding dual sector participation helps distinguish mixed economies from pure market capitalism or pure command socialism.
2
Examine the role and extent of state regulatory authority
Governments use fiscal tools (taxes, subsidies) and statutory regulations to modify price or output signals to improve social welfare while leaving private capital ownership intact.
Regulatory intervention guides market operations rather than abolishing private property rights.

Key Concept

Co-existence of private ownership and government regulatory intervention in a mixed economy
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Topics

Mixed Economy

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