Question

The end of Communist rule in Eastern Europe in the 1990s was due primarily to the economies there. State-controlled production led to workers being underpaid with little incentive to produce more or better goods. What conclusion can you draw from this passage? A) Taxes were too low to encourage production. B) People did not have enough skills to be successful. C) Eastern European countries were run as market economies. D) Eastern European countries were run as command economies.

Answer 1

The end of communist rule in eastern Europe was due primary because eastern European countries were run as command economies.

What is a command economy ?

A command economy is that in which the factors of production are firmly under the control of the government.

An example of a command economy was the Communist government which controlled Eastern Europe before is dissolution in the early 1990s.

In contrast, a market economy is that in which the factors of production are firmly under the control of the private sector such is obtainable in the United states.

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