7
QuizMultiple Choice

Microeconomics and Entrepreneurship — Test

Question 7 • Personal Finance

Which statement best describes a command economy?

Answer
A
The decisions made by producers and consumers drive all economic choices.
B
Producers and consumers make some economic choices while the government makes others.
C
Government intervention in economic choices is strictly forbidden.
D
The government determines economic choices and makes most decisions.

Explanation

In a command economy, the government directs economic activity and makes most decisions, such as what to produce and how resources are used. That matches choice C, “The government determines economic choices and makes most decisions.” Choice A describes a mixed economy, where the government and private individuals share decision-making.

AI-written and checked against the verified answer.

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