Author Question: Define the two categories of planned economies and illustrate the differences and similarities ... (Read 92 times)

geoffrey · **on:** Jul 14, 2018

Define the two categories of planned economies and illustrate the differences and similarities between them.

Question 2

In addition to political considerations, all of the following are reasons for trade restrictions except
A) equalizing a nation's balance of payments.
B) protecting new and weak industries.
C) protecting the health of citizens.
D) protecting national security.
E) all of the above are reasons for trade restrictions.

stanleka1 · **Reply #1 on:** Jul 14, 2018

Answer to Question 1

The two key categories of planned economies are socialism and communism.

Socialism is an economic system based on the principle that the government should own and operate key enterprises that directly affect public welfare, such as utilities, telecommunications, and healthcare. While the official government goal is to run these enterprises in the best interest of the overall public, inefficiencies and corruption often interfere with effectiveness. Socialist economies also tend to have higher taxes, which are designed to distribute wealth more evenly through society.

Communism is an economic and political system that calls for public ownership of virtually all enterprises, under the direction of a strong central government. The communist concept was the brainchild of political philosopher Karl Marx, who outlined its core principles in his 1848 Communist Manifesto. The communism that Marx envisioned was supposed to dramatically improve the lot of the worker at the expense of the super-rich.

Answer to Question 2

E