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11 December, 13:43

What is a major disadvantige of a centrally planned economy

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  1. 11 December, 17:28
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    Lack of competition

    Explanation:

    A centrally planned economy lack competitiveness. The government decides what to produce, the price, and the distribution channel. Because of these restrictions, there is no motivation for profits. Without competition, a centrally planned economy will have the following features.

    There be a lot of inefficiency and wastefulness. Consumers will not have a variety of goods and services to choose from in the markets. Businesses will make low profits.
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