passwella.
Menu

JAMB Economics 2001 Question 14

Question 14

Economic Systems

The fixing of the price of an item above or below the equilibrium price is most likely to take place in a

  1. A.centrally planned economy
  2. B.free market economy
  3. C.developed economy
  4. D.mixed economy
Show the answer and explanation

Answer: A (centrally planned economy)

Explanation

In a centrally planned economy the government, not the market, sets prices, so prices are often fixed above or below equilibrium.