How is the allocation of goods and services production determined in a command country?
Businesses decide what to produce on the basis of a market condition
Consumers decide through their behaviors in the marketplace
Central government planning decides what will be produced
Supply & demand, control, production, and price
In a command country, the allocation of goods and services production is primarily determined through central government planning. The government sets production targets and determines what goods and services will be produced, in what quantities, and by which producers. The government may also control the production process and make decisions regarding prices and distribution.
Supply and demand play a limited role in determining production in a command economy as the government's central planning typically overrides market forces. However, the government may take into account certain aspects of supply and demand when making production decisions.
In a command economy, businesses do not have much autonomy or discretion in deciding what to produce. They are usually directed by the central planning authority to produce certain goods and services based on the government's goals and priorities. Consumer behavior in the marketplace also has limited influence, as the government dictates what will be available for consumers to purchase.
Overall, the allocation of goods and services production in a command country is primarily determined by central government planning, with limited consideration given to supply and demand dynamics, control over production processes, and price setting.
In a command economy, the allocation of goods and services production is determined through central government planning. Here is a step-by-step explanation:
1. Central government planning: In a command economy, the government exercises control over the production and distribution of goods and services. The government decides what will be produced, how much will be produced, and at what price.
2. Planning process: The government formulates economic plans that outline the production targets for different industries and sectors. These plans are usually created by central planning authorities, such as a planning commission or government agencies.
3. Resource allocation: The government determines how resources such as labor, capital, raw materials, and technology will be allocated to different industries and sectors. This can involve directives and regulations that specify the quantity of resources allocated to each sector.
4. Production decisions: Once the government has determined the production targets and allocated resources, it issues directives to state-owned enterprises or other authorized entities, specifying what goods and services should be produced, in what quantities, and by when.
5. Price control: The government also sets prices for goods and services to ensure affordability and equitable distribution. Prices may be set based on factors such as production costs, demand, and social considerations.
6. Supply and demand: While command economies operate based on government planning, supply and demand dynamics can still play a role in influencing production decisions. If there is a clear and immediate demand for a certain good or service, the government may adjust production plans to meet that demand.
It's important to note that in a command economy, businesses do not independently decide what to produce based on market conditions, and consumers do not have the freedom to make choices through their behavior in the marketplace. Production and allocation decisions are primarily determined by the central government planning process.
In a command economy, the allocation of goods and services production is determined primarily through central government planning. Here's how it works:
1. Central Government Planning: In a command economy, the government plays a dominant role in directing and controlling economic activities. This involves setting production targets, determining what goods and services will be produced, and allocating resources to achieve those targets. The government makes decisions on what to produce based on national priorities, social needs, and economic goals.
2. Allocation of Resources: Once the government determines what goods and services will be produced, they also decide how resources such as labor, capital, and raw materials will be distributed to different industries and sectors. This is done to ensure that production aligns with the government's objectives and plans.
3. Supply and Demand Considerations: While the central government planning determines the overall production goals, it may also take into account some aspects of supply and demand. For example, the government might assess the needs and preferences of the population to some extent, but ultimately the final decisions rest with the government.
4. Control over Production and Pricing: In a command economy, the government exercises significant control over production processes and sets prices for goods and services. The government often determines the quantity of output, the prices at which goods will be sold, and even the wages of workers. This helps ensure that the resources are utilized in accordance with the government's plans and distribution is carried out as intended.
Overall, the allocation of goods and services production in a command economy is determined by centralized government planning, with considerations for national priorities and economic goals, rather than market forces like supply and demand.