ECONOMICS
ECONOMIC SYSTEMS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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All production is managed by the government.
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All economic decisions are made by the free market.
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All economic decisions are based on custom and habit.
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Some degree of private ownership and activity is allowed.
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Detailed explanation-1: -In a communist economy, the state controls all of the factors of production. In a socialist economy, the government only controls some of the factors of production. A key difference is that citizens can own private property under socialism and cannot under communism.
Detailed explanation-2: -First, the government controls a command economy, while the workers control a socialist economy. Second, in a command economy, businesses are directed to produce specific goods, while in a socialist economy businesses are free to produce whatever they want.
Detailed explanation-3: -A socialist government with a command economy controls the factories along with other forms of production. The government controls factories and other forms of production.
Detailed explanation-4: -Communism, also known as a command system, is an economic system where the government owns most of the factors of production and decides the allocation of resources and what products and services will be provided. The most important originators of communist doctrine were Karl Marx and Frederick Engels.
Detailed explanation-5: -A command economy does not allow market forces like supply and demand to determine what, how much, and at what price they should produce goods and services. Instead, a central government plans, organizes, and controls all economic activities, discouraging market competition.