Distinguish between the characteristics of a market economy and a command economy.

- Government sets prices of goods and services.
- Consumer demand drives production decisions.
- Private ownership of land is limited or prohibited.
- Japan is an example of this economic system.

Market Economy:
- Consumer demand drives production decisions.
- Private ownership of land is allowed.

Command Economy:
- Government sets prices of goods and services.
- Private ownership of land is limited or prohibited.
- Japan is an example of this economic system.



Answer :

Final answer:

The characteristics of market and command economies are distinct, with differences in decision-making, price setting, and ownership.


Explanation:

In a market economy, decisions are decentralized, and consumer demand drives production decisions. Private ownership of land is allowed, and the government does not set prices of goods and services. An example of a market economy is the United States.

Conversely, in a command economy, decisions are centrally planned by the government. The government sets prices of goods and services and owns resources and businesses. An example of a command economy is North Korea.

Market forces determine economic decisions in a market economy, while government officials make decisions in a command economy.


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