Econ 1.2 FOPs

Multiple Choice

True or false: Scarcity affects all individuals and businesses?

• True

• False

Multiple Choice

Which of the following is NOT one of the three big economic questions that every society must answer?

• How to produce?

• What to produce?

• How to consume?

• For whom to produce?

Multiple Choice

Which of the following best describes the main purpose of an economic system?

• To organize an economy to allocate resources efficiently and fairly

• To increase the population of a country

• To promote only technological advancements

• To create new forms of government

Multiple Choice

Which of the following is a characteristic of a traditional economy?

• Central authority controls production

• Production is based on communal needs

• Production decisions are made by buyers and sellers

• Profit is the main motivation

Open Ended

What do you think Adam Smith means by we get our dinner because of the "self-interest" of others?

Multiple Select

Which of the following are considered pros of a market economy?

• Freedom of choice

• Income inequality

• Leads to innovation

• Does not provide products/services unless profit is available

Multiple Choice

Who controls the factors of production in a command economy?

• Private individuals

• Central authority

• Buyers and sellers

• Local communities

Multiple Choice

According to Karl Marx, what is the main principle of Communism as stated in the quote?

• Abolish all private property

• Promote free markets

• Encourage entrepreneurship

• Support monarchy

Multiple Choice

How does Karl Marx describe the consequences of wealth accumulation by the upper class?

• It leads to misery and degradation at the opposite pole

• It results in overall prosperity

• It encourages innovation

• It creates more jobs

Open Ended

What are some examples of government intervention in the economy?

Multiple Choice

Which country is positioned closest to a pure command economy on the Mixed Economy Continuum?

• North Korea

• Cuba

• China

• France