What is an Economic system?

Because of the fact that there is scarcity of resources and unlimited wants, it is always a problem to allocate resources in an efficient manner. We are constantly facing 3 basic questions. These are:
1.What to produce?
2.How to produce?
3.For whom do we produce?

Every community or country must choose and develop its own way of solving these problems. The way a country decides what to produce, how to produce and for whom do we produce is called an economic system.
The 3 economic system existing are:

  • Mixed Economic system
  • Planned Economic system
  • Market Economic system

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