Rationale of Malaysia's Economic System on Utility Maximization

            Usually, the first disadvantage that people who oppose free enterprise bring up is the significant social division, or gap between the rich and poor. Although this may be true, it is an inevitable misfortune that will be found in all forms of markets - unless, of course, you live in a utopia. The sad truth is, there will always be a gap between the wealthy and less fortunate, even in

Mixed economy is a great economy but it has it has a lot of flaws. First off taxes, taxes depend on your money income so if you don’t have a huge money income you pay less taxes but that doesn’t mean you don’t pay quite a bit, an average middle class American that gets between $30,000 to $75,000 has to pay 31.85% tax. The government doesn’t decide what goods are produced though so there is more freedom so people produce goods based on supply and demand so businesses and industries can be managed by private firms. But the government intervenes in a mixed economy. Also in 2015 U.S. $3.2 trillion

In a mixed market economy like the UK’s, citizens are given plenty more freedom, which comes with its own risks as well. As a whole, command economies are heavily controlled and restricted by the government without much input from citizens themselves. Though both systems have their individual pros and cons to each, a mixed market economy is the best functioning option, as it gives the people freedom to make their own choices without being under complete government control. In this system, government still makes a prevalent impact on society, which allows for a sense of safety and security among the nation. Ultimately, individual countries develop their system to best regulate their own economic choices and

Malaysia’s GDP Annual Growth Rate since 2000 till present. Notice the sharp contraction after the 2008 Financial Crises.

In our society today, there are many distinct types of economies. The three leading economies are Market economies, Traditional Economies, and Command Economies. Each Economy is very diverse and unique from the next. An example of a market economy is in the US, and in a market economy there is a great deal of individual freedom and less government involvement. A market economy is based on Capitalism. A Traditional economy is a small group of people who are their own government. Not many societies today use a traditional economy. In a command economy the government controls all economic decisions. Examples of command economies are communist countries such as China and North Korea. Each type of economy has its own advantages and disadvantages as well as its differences about resources and government involvement.

Our country once deemed a “capitalistic society” has become more of a mixed economy by necessity. There are many benefits to a free-market economy and trade system which benefit society and individuals

The three major economic systems are centrally planned economy, market economy and mixed economy. Centrally planned economy is an economy in which the government decides on how resources will be used. Market economy is an economy in which individuals, households, and firms participating and interacting in markets determine how economic resources are used. Mixed economy is “primarily a market economy because most economic decisions are a result of the interaction of buyers and seller in markets. However, the government plays a significant role in the allocation of resources” (Hubbard & O'Brien, 2010, pp. 3-31).

Normally, Malaysian inflation rate is controlled by the government. Malaysia shows a unique feature in terms of inflationary experiences; the economy had experienced high and low regimes of inflation, and was able to contain a low and stable inflation during the high economic growth period of 1988–96. This achievement is related to low inflation during the high economic growth regime was attributed to the effective and consistent policy mix adopted by the Malaysian government.

Continuous rapid economic growth has raised Malaysia from an agricultural and commodity-based low-income economy to a successful middle-income economy. As a mixed economy, Malaysia has elements of a free market economy nevertheless with intervention government. Malaysia's economic activity consist of a mixture of sectors whereas mixed of capitalism and socialism The strong economic performance has helped improve the quality of life for Malaysians and supported advances in education, health, infrastructure, housing and public amenities and others.

Furthermore, there are many arguments against the indirect tax reform in developing countries. A country like Malaysia with presence of a substantial ‘informal’

Malaysia is a country on the move, from a country dependent on agriculture and primary commodities, Malaysia has today become an export-driven economy spurred on by high technology, knowledge-based and capital-intensive industries.

In Spite of the day by day challenging global economic circumstances, the Malaysian economy had expanded to 5.1% during the first half year of 2012 compared with the previous year of 2011 which is 4.7% and this has been increased by 0.4%. As the Euro region debt crisis shows no obvious indication of alleviate, the global economic is prospective to further ease up during the second half of 2012. During second half year of 2012, the depravation of the slowdown of emerging economies especially in India and China or the economic growth in developed economies correction in merchandise prices are prospective to weigh Malaysia’s export performance. By reason of the resilient domestic economy and external sector consider cause of downside risk, the real Gross Domestic Product (GDP) is predicted to extend from 4.5% to 5% in 2012, while the previous year is 5.1%.

Mixed economy -A monetary framework that components of both private enterprise and communism. A blended monetary framework permits the level of private financial flexibility in the utilization of capital, additionally considers governments to meddle in monetary exercises to meddle in financial exercises to accomplish social points. This sort of financial matters frameworks is less effective than free enterprise, yet more productive than private enterprise, yet more proficient than communism.

Malaysia is an interesting culture. They can trace their roots as far back as 8000 BC and yet only established themselves as a country in 1963. They are a multicultural society composed primarily of Chinese, Indians, and the native Malays, and as such, respect plays a large role in their culture. Unfortunately, corruption has also played a large role, with the native Malays being in power since the conception in 1963, and now, with the ever growing prominence of technology, the people are speaking out.

Taxes affect individuals and businesses differently. Some individuals, when they hear the word taxes, get very angry. The effect of governments imposing taxes has led individuals to starting a war for their independence and governments being overthrown. The tax rates imposed by governments have led businesses and corporations to move away from countries or have enticed businesses into a country by the absence of charging taxes. Countries which do not impose taxes on its people lack a functioning society, working economy, defense against enemies, and an undeveloped infrastructure.