ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Government Controls Production in Command Economy The government decides the means of production and owns the industries that produce goods and services for the public. The government prices and produces goods and services that it thinks benefits the people.

Detailed explanation-2: -A command economy is one where the central government makes all of the economic decisions. Capitalism is a system where the decisions are made by private individuals based on the profit motive.

Detailed explanation-3: -A command economy, also known as a planned economy, is one in which the central government plans, organizes, and controls all economic activities to maximize social welfare. Command economies, as opposed to free-market economies, do not allow market forces like supply and demand to determine production or prices.

Detailed explanation-4: -What are the characteristics of a command economy? A command economy has a small number of typical elements: A central economic plan, government ownership of the means of production, and (supposed) social equality are essential features of a command economy.