Question

Which of these is a correct description of one of the ways in which a command economy differs from a market economy?

Answer 1

D) In a command economy, individuals have less economic freedom.

Answer 2

The fourth answer is correct (D).

A command economy is characterized by state control of the means of production and commercialization. It is a system where free trade competition is overlooked by state decisions on price and production. Unorthodox economic policies such as price controls are commonly observed in command economies.

This type of model is usually observed in communist and socialist countries such as North Korea.

Of course, individuals' choice choices are limited to state decisions, unlike market economies, which are characterized by free entry and competition.