A command economic system is characterized by which of the following?

• A. Centralized government control over production and allocation of resources
• B. Private ownership of resources and free market pricing
• C. Decentralized decision-making by individual consumers and firms
• D. Minimal government intervention in economic activities

Answer: (A)

Verified step by step guidance

1. Understand the definition of a command economic system: it is an economic system where the government has significant control over the production and allocation of resources.
2. Recognize that in a command economy, the government typically owns or controls the means of production rather than private individuals or firms.
3. Note that pricing and production decisions are made centrally by the government, not by market forces or individual consumers and firms.
4. Contrast this with other economic systems such as market economies, where private ownership and decentralized decision-making prevail.
5. Conclude that the key characteristic of a command economic system is centralized government control over production and allocation of resources.