Distinguish between a centrally planned economy and a market economy.

Open in App

Solution

A centrally planned economy is the one in which economic activities (production, consumption and exchange) are governed by the government. Market economy is the one in which economic activities (production, consumption and exchange) are governed by the market forces of supply and demand.

Suggest Corrections

Similar questions

Distinguish between a centrally planned economy and a market economy.

Q. 23. Consider the following statements regarding Market Economy Status
1. It is given by WTO to a country where key pricing of goods and services are guided solely by the market.
2. It is opposite to a centrally planned economy, where government decisions drive country’s economic activity.
3. China’s economy has been granted this status in 2016.
Which of the above statement(s) is/are correct?

Q. Distinguish between

1. Objectives of the Tenth Five-Year Plan and Eleventh Five-Year Plan.

2. Planned economy and unplanned economy.

Q. Write the meaning of Centrally Planned Economy.

In a Centrally Planned Economy, the three aspects of Ownership, Production, and Allocation are all controlled by the government or the central planning authority.

Join BYJU'S Learning Program