· It is one of only a few command economies still in existence today. · It was the scene of widespread famine as recently as the late 1990s. · Though it has an extremely low per capita GDP of $1900, it spends the majority of its budget on military and defense. What nation is described by these statements?

The correct answer is North Korea

North Korea has an extremely closed and centralized economy, as its economic system falls within the socialist model. The economy is fully controlled by the government. The industrial sector is not very efficient due mainly to low investments and lack of competition. The country also faces serious problems in the agricultural sector, finding shortages of different types of food. The country's infrastructure is poorly developed, as it also does not have investments. As wages are controlled in the country, a large part of the population has a low income (by the standards of developed capitalist countries) and similar. Therefore, there are no significant economic inequalities in the population. The North Korean government allocates a large part of the funds raised for military investments. The country has little commercial contact with other nations, as it is not inserted in the globalized market.

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