Economics Paper 2, May/June 2011  
Questions: 1 2 3 4 5 6 7 8 9 10 11 12 Main
General Comments

Question 3
(a)      What is a centrally planned economy ?
(b)     Outline any four features of a capitalist economy ?


This question was attempted by a good number of candidates who performed well above average. Candidates needed to explain the following points to score the maximum marks for this question;

(a)      A centrally planned economy is one in which there is public ownership of the means of production and in which the decisions as to what to produce, how to produce and for whom to produce are made by the government.

(b)     Features of capitalist economy

(1) there is private ownership of resources;
(2) production decisions are taken mainly by  private individuals and organizations;
(3) capital is provided by private individuals and organizations;
(4) there is the profit motive;
(5) there is very limited government participation in economic activity;
(6) market forces determine allocation of resources.









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