Stormie Zanzibar owns a bakery in the fictitious country of Olombia. Each month the government’s market ministry mails her a large list of the regulated price of goods which include products like bread, muffins and flat bread. The list also dictates the types of goods she can sell at the bakery and what she is to charge. Because of the regulations placed on these goods, Stormie has increased her production of sweets, pies, cakes, croissants and buns and decreased her supply of breads, muffins and flat bread. She has taken these steps because the sweet goods’ prices are not government controlled. Stormie Zanzibar lives under what type of economy?

The correct answer is: a centralized planned economy.

Explanation:

To begin with, a planned economy is a type of economic system where the investment, the production and more take place under a production plan develop by the organization in charge, in this case, the government. Moreover, a centralized form of planned economy characterizes by the qualities of not letting the people and the market decide freely by instead is the government who takes all the decisions that will impact in the economy.

The fact that Stormie receive a list with all the information about the prices and restrictions in the economy indicates that she lives under a centralized planned economy system.

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