What describes a "Transitional Economy"?

A transitional economy is characterized by a state-controlled economy moving towards a market-oriented economy. This transition typically involves changes in political, economic, and social structures. In such economies, there is a shift from central planning and government control of resources and production to a system that encourages private enterprise, market mechanisms, and competition. This process can include privatization of state-owned enterprises, liberalization of trade and investment, and the establishment of financial markets.

Transitional economies often emerge from previously communist or heavily regulated systems where the government played a central role in the economy. The transition can be challenging, as it involves overcoming barriers such as lack of market experience, underdeveloped financial markets, and significant changes in public policy. Overall, the primary goal is to stimulate growth, increase efficiency, and improve living standards by integrating into the global economy.

The other options do not accurately reflect the definition of a transitional economy. A fully developed capitalist system is stable and has already made the transition to a market economy. A resource-rich economy struggling with poverty might not be undergoing a transition but could be facing other issues unrelated to the structure of its economic system. An economy focused exclusively on agriculture suggests a specific sectoral focus, rather than the broader economic transformation described in a transitional economy