Question

What are the disadvantages of socialistic economy?

• A. No economic growth
• B. Nonexistence of competition
• C. Inefficiency arises
• D. All of the above

Answer 1

Answer: (D)

All of the above

Demerits of socialist economy are as follows :-
a) Individuals are not allowed to own any assets, everything belongs to the state.
b) No economic growth
c) Non existence of competition
d) Inefficiency arises
e) Lack of economic freedom
f) Socialist economy is very rigid and not susceptible to change according to requirements. Hence people work like a machine and never get any incentive to work.