Answer:
A market economy is an economy that is primarly based on free markets, where consumers and producers meet to buy and sell goods and services, and prices are set according to the forces of supply and demand.
A Soviet-style communist economy, is also known as a planned economy or command economy. This is an economy where private property does not exist, the government owns all property, and plans the economy with years of anticipation. Prices are set by the government, as well as the quantities of goods and services that are produced and delivered.
The problem with planned economies is that it becomes too difficult for the government to coordinate economic activity. The government lacks a lot of vital information, and ends up assigning resources to activities that are not efficient. These economies also lack proper prices, which are the signals that coordinate economic activity.
For that reason, the market economies prevailed over the planned economies, they were simply more efficient: better at producing more goods and services, at cheaper prices, and using less resources.
Answer:
The government, not the market, deciding
what gets produced leads to producing
many items consumers don’t want. - There was an abundance of flannel pants
and a lack of jeans.
Command economies have a lack of
incentives to produce what would sell. - The Communist Party “knew what everyone
needed" (or thought it did).
The government answers economic
questions in a command economy. - The Soviet Union’s economy was based
on centralized planning.
Resources can be misused when the
market doesn’t decide how resources
are used. - The emphasis was on military production,
not fashionable clothes.
Market systems respond to signals from
consumers. - Jeans were being sold in the West and
not in the Soviet Union.
Explanation:
PLATO
