ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -What is a Command Economy? Command economy is a system where the government decides goods production, process, quantity, and price in a country. In this system, the government also manages income and investments. A communist nation like the former Soviet Union, Cuba, and North Korea work according to this system.

Detailed explanation-2: -In a command economy, the government owns the factors of production; all decisions about land, labor, and capital are made by the state.

Detailed explanation-3: -In command economies, the government controls the factors of production and answers the 3 economic questions of what, how and for whom to produce for all of society. Command economies often associated with socialism, communism and authoritarianism.

Detailed explanation-4: -A command economy is an economic system where the government has control over the production and pricing of goods and services.

Detailed explanation-5: -Under the command economy, the government exercises the most control for the factors of production such as capital, labor, entrepreneurship and land.