Question

In a socialistic pattern of economy the problem of allocation of resources is addressed by __________.

• A. market forces
• B. administrative price mechanism
• C. mutually by producers and consumers
• D. central bank

Answer 1

Answer: (B)

administrative price mechanism

In socialism, the problem of choice or the problem of allocation of resources to its alternative uses is addressed by administrative price mechanism, that is, by the free play of market forces (demand and supply) along with the government intervention in order to check the imbalance in market conditions by fiscal and monetary policies.