A characteristic of centrally planned economies is that:
A) The price is relatively unimportant in allocating resources
B) Output reflects the pattern of consumer spending
C) Entrepreneurship is quite prevalent and highly rewarded
D) There are many incentives for innovation and hard work

Question

Quizplus · Accepted Answer

In a centrally planned economy, the government controls the allocation of resources, not the market. Therefore, prices are not as important in determining how resources are allocated.

A Characteristic of Centrally Planned Economies Is That