A command economy is a private business that the government does not support. It is purely driven by consumers. They decide on what is produced.
A demand economy is a business where only the government decides what is produced.
There is also something called a mixed economy and that is when the government supports private businesses and decides what is produced for them.
Command economy, due to the imperfect market it always creats, it shall always supply economic goods(scarcity) in the market to alow high demand, hence monopoly of the market.
A command free market, often referred to as a market economy, relies on supply and demand to determine prices and allocate resources, allowing individuals and businesses to make decisions based on competition and personal interests. In contrast, a socialist economy is characterized by centralized control, where the government or state makes decisions regarding production, distribution, and pricing, aiming for equitable distribution of resources and wealth. This fundamental difference leads to varying levels of economic freedom and efficiency in resource allocation between the two systems.
To bring the economy back to its long-run equilibrium, the required change in aggregate demand would need to be equal to the difference between the current level of aggregate demand and the level of aggregate demand that corresponds to the long-run equilibrium. This change would need to be sufficient to close the gap between the two levels and restore balance in the economy.
The law of demand is that, all other factors held constant, the quantity of a good demanded increases as the price of that good falls. In a command economy, unlike a free market economy, it is the govenment, not market supply and demand,that determines prices.
There are a few main characteristics of a command economy. These include having the government make decisions about which sections produce what products, the demand being based on the decision of the market economy, and the pricing being decided by the government.
Supply and demand determines what will be produced.
Command economy, due to the imperfect market it always creats, it shall always supply economic goods(scarcity) in the market to alow high demand, hence monopoly of the market.
difference between elastic and inelastic demand
government decisions
In a command economy, supply and demand are replaced by government edicts. However, the national economy can still fail, as happened in the USSR.
To bring the economy back to its long-run equilibrium, the required change in aggregate demand would need to be equal to the difference between the current level of aggregate demand and the level of aggregate demand that corresponds to the long-run equilibrium. This change would need to be sufficient to close the gap between the two levels and restore balance in the economy.
The law of demand is that, all other factors held constant, the quantity of a good demanded increases as the price of that good falls. In a command economy, unlike a free market economy, it is the govenment, not market supply and demand,that determines prices.
There are a few main characteristics of a command economy. These include having the government make decisions about which sections produce what products, the demand being based on the decision of the market economy, and the pricing being decided by the government.
There are a few main characteristics of a command economy. These include having the government make decisions about which sections produce what products, the demand being based on the decision of the market economy, and the pricing being decided by the government.
Demand refers to the quantity of a specific good or service that consumers are willing and able to buy at a given price. Aggregate demand, on the other hand, refers to the total quantity of all goods and services that all consumers, businesses, and governments in an economy are willing and able to buy at a given price level. In essence, demand focuses on individual products, while aggregate demand looks at the overall demand in an economy.
distinguish between a term security and a demand security
Societies determine who will consume what is produced through various systems such as market economy, command economy, traditional economy, or mixed economy. In a market economy, pricing and consumer demand play a significant role in allocation. In a command economy, the government decides on distribution. Traditional economies follow customs and traditions, while mixed economies combine elements of both market and command systems.