Which situation is more likely to occur in a market economy than a command economy?
An inventor designs and produces a new type of car
People line up for cheap but scarce products.
A student is guaranteed a job out of college.
A committee chooses which farms should receive new tractors.
which one is right?
An inventor designs and produces a new type of car is more likely to occur in a market economy than in a command economy.
Here's why for each statement:
1. **An inventor designs and produces a new type of car:** In a market economy, there is generally more freedom for entrepreneurs and inventors to create new products and services without needing government approval, and they can potentially earn significant profits if their innovations meet consumer demands. This fosters an environment where innovation is more likely to thrive.
2. **People line up for cheap but scarce products:** This can potentially happen in either system, but it's commonly associated with command economies where the government controls supply and often sets prices. This can lead to misallocation of resources and shortages.
3. **A student is guaranteed a job out of college:** Such guarantees are more characteristic of command economies, where the government often arranges employment to manage the economy. In a market economy, there are no guarantees, and employment depends on the supply and demand of jobs and the skills of the workers.
4. **A committee chooses which farms should receive new tractors:** This allocation of resources is typical of a command economy, where decisions about production and distribution are made by centralized authorities rather than by market forces.
Therefore, the first scenario aligns most closely with the dynamics of a market economy.