Which of the following are true?
a)In a socialist economy, goods produced are distributed on the basis of purchasing power of people.
b)In a socialist economy, a poor person is more likely to get a house.
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → b is true, a is not
Under socialism, goods are meant to go by what people need, not by what they can afford.
a) In a socialist economy, goods produced are distributed on the basis of purchasing power of people. — False. Distribution by purchasing power is a feature of capitalism.
b) In a socialist economy, a poor person is more likely to get a house. — True. Since goods go by need, a poor person’s need for a house counts even without money. Under capitalism, low cost housing for the poor is not produced.
NCERT (2026-27): “Box 2.1: Types of Economic Systems … In a capitalist society the goods produced are distributed among people not on the basis of what people need but on the basis of Purchasing Power—the ability to buy goods and services. That is, one has to have the money in the pocket to buy it. Low cost housing for the poor is much needed but will not count as demand in the market sense because the poor do not have the purchasing power to back the demand. As a result this commodity will not be produced and supplied as per market forces. …” “… In principle, distribution under socialism is supposed to be based on what people need and not on what they can afford to purchase. Unlike under capitalism, for example, a socialist nation provides free health care to all its citizens. …” |