Question

A command economy is best described as an economy that:

Options:
a. Gives both businesses and the government a role in economic decisions.
b. Gives businesses complete freedom to produce and sell what they want.
c. Gives the government complete control over production and prices.
d. Gives people jobs based on their family history and role in the community.

Answer 1

A command economy is where the government has complete control over production and prices, makes all economic decisions, and often provides basic necessities for free, as seen in countries like Cuba and North Korea.

Step-by-step explanation:

A command economy is best described as an economy where the government has complete control over production, prices, and the distribution of resources. In a command economy, the government decides what goods and services will be produced, what prices will be set, and the methods of production. It also determines wages for workers and typically provides many basic necessities like healthcare and education for free.

Examples of countries that have a command economy include Cuba and North Korea, where the government exercises significant control over the economy, often owning the means of production and making central decisions on behalf of the country's populace.

Therefore, the correct answer to the student's question is: c. Gives the government complete control over production and prices.