"Because the outputs of many industries are the inputs to other industries,the failure of any single industry to fulfill the output quantities specified in the central plan caused a chain reaction of adverse repercussions on production." This quotation best identifies the:
A) incentive problem under central planning.
B) self-sufficiency dilemma under communism.
C) resource overcommitment problem under communism.
D) coordination problem under central planning.

Question

Quizplus · Accepted Answer

The quotation describes the coordination problem under central planning, where the failure of one industry to meet output targets can have negative effects on other industries. This highlights the difficulty of accurately predicting and coordinating the production outputs of multiple industries under a centralized planning system.

"Because the Outputs of Many Industries Are the Inputs to Other