This was a straightforward question which was surprisingly avoided by the majority of the candidates. The overall performance of the candidates on the question was below average.
The few candidates who scored good marks defined economic system as an arrangement for managing the relatively scarce resources in a particular place and at a particular time.
Characteristics of a mixed economic system are as follows:
(i) The government uses various policies to promote economic growth and stability.
(ii) The government provides and maintains infrastructural facilities e.g. roads, water, electricity, etc. which are not provided by the private sector.
(iii) Some factors of production are owned by private individuals and firms while others are owned by the government
(iv) People are free to choose their occupations; however, the government can still influence people's choice of occupation e.g. providing funds for certain courses - medicine and teaching.
(v) Resources are allocated by both the price mechanism and the government.
The government caters for the welfare of people.

The disadvantages of a mixed economic system are that
(i) government may raise the level of taxation excessively;
(ii) government spending may be at variance with people's wishes;
(iii) government price control measures often disturb the price mechanism;
(iv) there are often disagreements over the degree of government intervention.