Consider the following economic agents:

a. the government

b. consumers

c. producers

Who, in a centrally planned economy, decides what goods and services will be produced with the scarce resources available in that economy?

The correct answer is option a.

Explanation:

A centrally planned economy is a system in which a central agency such as the government takes all the economic decisions. The government decides the allocation of resources, what to produce, how to produce, the price level, etc.

Such a system is contrary to a market economy where the market forces determine the price, quantity, etc.

The government, in a centrally planned economy, will determine the allocation of scarce resources to produce goods and services, not producers or consumers.