Introduction to Business EconomicsPYQ Jun 22Question 577 of 209
All Questions

Which of the following is an economic system regulating and run by individual hands?

Options

AMixed economic system
BSocialistic economic system
CCapitalist economic system
DPlanned economic system
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Correct Answer

✅ Option c — Capitalist economic system

All Options:

  • AMixed economic system
  • BSocialistic economic system
  • CCapitalist economic system
  • DPlanned economic system

Detailed Solution & Explanation

• The question asks to identify an economic system primarily regulated and run by individual hands. This points to a system where private ownership and individual decision-making are central. • A Capitalist economic system, also known as a free market economy, is characterized by private ownership of the means of production, profit motive, competition, and minimal government intervention. In this system, individuals and private firms make most economic decisions regarding production, consumption, and investment. This directly aligns with the description "regulating and run by individual hands." • Therefore, option (C) Capitalist economic system is the correct answer. • Let's look at why other options are incorrect. A Socialistic economic system (B) is characterized by collective or state ownership of the means of production, with the government playing a dominant role in economic planning and resource allocation. This is the opposite of individual hands running the system. • A Mixed economic system (A) combines elements of both capitalism and socialism, with both private and public sectors playing significant roles. While individuals have a role, the system is not *solely* regulated and run by individual hands due to government involvement. • A Planned economic system (D) is essentially another name for a command or socialist economy, where central authorities make all major economic decisions. This again contradicts the idea of individual control.

About This Chapter: Introduction to Business Economics

Paper

Paper 4: Business Economics

Weightage

5%

Key Topics

Meaning, Scope, Price Mechanism

This chapter lays the groundwork for understanding Business Economics as a discipline. It covers the meaning, scope, and nature of economics — including key distinctions like Microeconomics vs Macroeconomics, Positive vs Normative economics, and the fundamental economic problem of scarcity. Students learn how businesses use economic principles for decision-making in a competitive marketplace.

View Official ICAI Syllabus

Exam Strategy Tip

Focus on definitions and distinctions between concepts. Questions often test whether you understand the difference between Micro and Macro, or Positive and Normative statements.

Related Comparison Tables

Microeconomics vs Macroeconomics: The Complete CA Foundation GuidePositive vs Normative Economics: Fact vs Opinion

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