ICSE Class 9 Answered

An economy is a system which provides people with goods and services and directly or indirectly satisfies their wants. 

On the basis of ownership over the means of production, economies are classified into the following categories: 

• Capitalist Economy: It refers to a type of economy wherein private owners own the means of production such as land and capital. There is no kind of interference from the government in the economic activities of the country. 
• Socialist Economy: It refers to a type of economy wherein all the economic activities are controlled and regulated by a community or government so as to ensure welfare, achievements and equal opportunities to all the people of the country. 
• Mixed Economy: It refers to a type of economy wherein some important part of production is undertaken by the government, while some is left to private owners. Thus, it is a blend of both capitalist and socialist economies.