Which situation is more likely to occur in a Market Economy than a Command Economy?
(1 point)
a citizen designs a new game and opens a store to sell it
people line up for scarce products.
the government controls all aspects of business
government sets prices on good sold
a citizen designs a new game and opens a store to sell it
In a Market Economy, a citizen designing a new game and opening a store to sell it is more likely to occur than in a Command Economy.
In order to determine which situation is more likely to occur in a Market Economy than a Command Economy, let's start by understanding the key characteristics of each type of economy.
In a Market Economy, economic decisions and resource allocation are primarily determined by the interactions of individual buyers and sellers. Market forces such as supply and demand play a significant role, and businesses operate independently of government influence. Market economies prioritize private ownership, competition, and the pursuit of profit.
On the other hand, in a Command Economy, economic decisions and resource allocation are predominantly controlled by a centralized authority, usually the government. The government determines what goods and services are produced, sets prices for them, and coordinates the distribution of resources. Private ownership and competition are generally limited.
Now, considering these characteristics, we can evaluate the given situations:
1. A citizen designs a new game and opens a store to sell it:
This situation is more likely to occur in a Market Economy because in such an economy, individuals have the freedom to create and launch new products or services. Entrepreneurs can establish businesses and compete with others in the market. In a Command Economy, where the government controls business activities, the opportunity for individuals to freely start their own stores and sell products may be limited.
2. People line up for scarce products:
While scarcity of products can occur in both market and command economies, the likelihood of people lining up for scarce products is generally higher in a Market Economy. In a Market Economy, supplies and prices are determined by market forces, and when a particular product becomes scarce, demand often exceeds supply. This can lead to people lining up to get hold of the limited available quantity. In a Command Economy, where the government controls the allocation of resources and typically aims to avoid scarcity, such situations may be less common.
3. The government controls all aspects of business:
This situation is more likely to occur in a Command Economy. In such an economy, the government exercises extensive control over businesses, including ownership, production decisions, prices, and resource allocation. The government's authority is dominant, and individual businesses have limited autonomy. In a Market Economy, on the other hand, businesses operate independently and are subjected to fewer government restrictions.
4. The government sets prices on goods sold:
This situation is also more likely to occur in a Command Economy. In a Command Economy, the government has the power to set and regulate prices for goods and services. The goal is to ensure affordability and equitable distribution. In contrast, in a Market Economy, prices are typically determined by the forces of supply and demand, with less government intervention.
Based on these explanations, we can conclude that a citizen designing a new game and opening a store to sell it is the situation most likely to occur in a Market Economy rather than a Command Economy.