Which Is NOT a Characteristic of a Centrally Planned Economy

question 15

Multiple Choice

Which is NOT a characteristic of a centrally planned economy?

• A) Planners set prices for goods produced in the economy.
• B) The right amounts of goods are usually available at the right time.
• C) Production levels for goods are determined by planners.
• D) Excess demand for some goods and excess supply for other goods is a common occurrence.

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Definitions:

Variable Cost

Expenses that vary directly with the level of production or sales volume, such as raw materials and direct labor costs.

Break-Even Analysis

A technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output.

Price-Setting Process

The method used by businesses to determine the selling price of their products or services, taking into account production costs, market demand, competition, and profit margins.

Product Life Cycle

The stages through which a product goes from its introduction into the market through its growth, maturity, and eventually, decline.