The Incentive Problem Under Communist Central Planning Refers to the Idea

question 2

Multiple Choice

The incentive problem under communist central planning refers to the idea that

• A) planners had to direct required inputs to each enterprise.
• B) workers, managers, and entrepreneurs could not personally gain by responding to shortages or surpluses or by introducing new and improved products.
• C) the immediate effect of more investment was less consumption.
• D) exports had to be equal to imports for a central plan to work.

---

Definitions:

Efficient

Achieving maximum productivity with minimum wasted effort or expense, often relating to the effective operation of a process or system.

E-mails

Electronic messages sent over the internet, used for personal or professional communication.

Casual Format

An informal or relaxed approach to presenting information or conducting meetings, which may foster a more comfortable and engaging environment.

Vulnerable Asset

An asset that is susceptible to threat or harm, requiring protection.