Day: August 14, 2017

Which ONE of the following best describes a ‘planned’ economy’?

Select ONE answer:

1. An economic system in which decisions about production and investment are decided by individuals and firms.
2. An economic system in which decisions about production and investment are decided by a central body or government.
3. An economic system in which is designed to ensure the fairest allocation of scarce resources.
4. An economic system in which decisions about production and investment are decided by a democratic vote of workers.
5. An economic system in which decisions about production and investment are decided by committees.

Give 3 examples of the disadvantages of a ‘planned economy’?
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This is multiple choice question is suitable for Economics KS5 classes.

The answer is 2 – an economy in which production, investment, prices, and incomes are determined centrally by the government.

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