ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -In theory, a communist economy is one in which the government owns all or most enterprises. Central planning by the government dictates which goods or services are produced, how they are produced, and who will receive them.

Detailed explanation-2: -Communism is a political system characterized by a centrally planned economy with all economic and political power resting in the hands of the government. Communist governments are authoritarian in nature. The government (or central authority) determines what, how, and for whom goods and services are produced.

Detailed explanation-3: -In a market economy, the producer gets to decide what to produce, how much to produce, what to charge customers for those goods, and what to pay employees. These decisions in a free-market economy are influenced by the pressures of competition, supply, and demand.

Detailed explanation-4: -Government Controls Production in Command Economy In a command economy, the government (or some other central authority) controls and steers major aspects of economic production. The government decides the means of production and owns the industries that produce goods and services for the public.

Detailed explanation-5: -In a market economy, resources are owned by private individuals. The goods and services that are produced are not determined by the government. Rather, production is determined by businesses responding to the wants and desires of consumers.