Which statement regarding command economies is FALSE?

The government owns the factors of production.

Central planners decide what is produced.

Self-interest influences the decisions made about production.

Consumer goods are in short supply.

The correct answer is letter "C": Self-interest influences the decisions made about production.

Explanation:

A command economy is one where the government controls the economy, acts as a central planner, dictates production quotas and distribution levels, and sets prices. Such economies exist in communist or socialist states such as China, North Korea, and Cuba.  

In a command economy, the government almost exclusively owns the means of production controlling the supply of output, most of the time leading to shortages.

answer/// real gdp decreases to y3 and the price level falls to p3;