Knowledge & Understanding 1. Definition of mixed economy 2. Role of private sector and public sector ina mixed economy Analysis 1. Under-provision and under-consumption of merit goods under market economy 2. Over-provision and over-consumption of demerit goods under market economy 3. Role of govt in provision of such goods 4. Missing market for public goods 5. Explain public goods- non-excludability and non-rivalrous 6. Free rider problem 7. Role of govt in provision of public goods Evaluation 1.It is difficult to quantify the level of under provision. It might over estimate the extent of the private benefits offered to the people by consuming merit goods.2. Difficult to calculate the most efficient quantity of public goods to supply 3. Govt can take tome to make decisions qnd those decisions may be influenced by political factors and, in some cases, corruption. For example, government may decide not to raise the tax on petrol, despite concerns about the environment, because it may be politically unpopular and may lose it votes. 4. Govt intervention may also reduce economic efficiency by reducing incentives. If taxes on earned income is high, then some people may be discouraged from working. 5. Opprtunitunity cost of govt provision like spending on education or health.