How Does a "Command Economy" Compare to a "Market Economy

question 81

Multiple Choice

How does a "command economy" compare to a "market economy"?

• A) Production and distribution decisions are made by central planners in a command economy, but not in a market economy.
• B) There is scarcity in command economies, but not in market economies.
• C) Command economies are less prone to inflation than are market economies.
• D) A command economy is more efficient than a market economy because decision making is centralized.

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Definitions:

Mutual Agreement

A common understanding or an arrangement that is accepted by all parties to a transaction or contract.

Mixed Goods-Services

Mixed goods-services refer to transactions that involve a combination of tangible products and intangible services in a single offering to consumers.

Federal Government

is the national government of a federal state, which holds the authority over the entire nation, distinct from state or local governments.

Good Faith

Acting with honesty and sincerity without any intention to deceive or defraud.