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JAMB Economics 1978 Question 42

Question 42

Economic Systems

Which of these should determine, in a planned economy, how the factors of production are to be allocated among different production activities?

  1. A.Fairness
  2. B.The distribution of income and wealth
  3. C.Public need, which is determined by the government
  4. D.Private needs determined by the market
  5. E.The ability of an individual to make profit.
Show the answer and explanation

Answer: C (Public need, which is determined by the government)

Explanation

In a planned economy the government decides what is needed and allocates resources accordingly, not the market.