Question

Which situation is more likely to occur in a market economy than a command economy

A. People line up for cheap but scarce products.

B. A student is guaranteed a job out of college.

C. An inventor designs and produces a new type of car.

D. A committee chooses which farms should receive new tractors.

Answer 1

In a Market Economy, where one of its characteristics is the definition and application of the property rights, the situations described in alternatives B and C are likely to occur. Whereas the alternatives A and D are examples of a Command Economy where the means of production are opperated by one organization.