In centrally planned economies, planners decided what goods and services were produced, how much was produced, but not who produced and consumed them. In centrally planned economies, planning and markets played equally important roles. The collapse of communism in the Soviet Union and Eastern Europe was not related to central economic planning. Most countries that once had centrally planned economies have abandoned that system and are trying to develop market economies. Most countries that once had centrally planned economies have abandoned that system and are trying to develop market economies.
People buy more when prices are high than when prices are low.
No matter how much people earn, they tend to spend more than they earn. An example of an externality is a. the impact of the personal income tax on a person's ability to purchase goods and services. If the average income of an American is higher than the average income of an Italian, it is most likely because a. labor unions are more aggressive in the United States than in Italy. In the United States, government deficits in recent decades, are financed by a. printing money, which creates inflation. The deficits are not financed.