Assume a perfectly competitive economy would use an assortment of nails that weighs a total of 100 tons. However, the economy is controlled by the government and it sets a ton limit of 100 tons. When production is complete there is only one nail that weighs 100 tons. Which of the following describes what was wrong when government did the planning?

Question

Quizplus · Accepted Answer

The government set a ton limit, but did not account for the variety and distribution of nails needed by consumers, leading to a mismatch between production and consumer needs.

Assume a Perfectly Competitive Economy Would Use an Assortment of Nails