Decisions in the former Soviet Union led to inefficiency, because:
A) planners incorporated consumer preferences into their decisions.
B) planners did not incorporate costs of all the factors of production in their decisions.
C) the market was not completely abandoned.
D) the market was overutilized.

Question

Quizplus · Accepted Answer

Planners did not incorporate costs of all the factors of production in their decisions, leading to inefficient allocation of resources. This resulted in the production of too much of certain goods and not enough of others, leading to shortages and surpluses. The lack of market pricing information and competition also contributed to inefficiency.

Decisions in the Former Soviet Union Led to Inefficiency, Because