Question

Why is the central planning system also called the command system?

Why is the central planning system also called the command system?

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Answer #1

Central planning system is also known as command system because central planning system is different from the free economy where the goods and services are determined through market forces of demand and supply so, in the command system type of economy all the decisions are made by the central government and the government determines what goods would be produced,how much would be produced and what would be the price and quantity supplied so this type of economy is a type of communist system where the government owns all the businesses and the economy is run accordingly to the rules and regulations laid down by the central law.

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