Review of Lesson 1

 Societies embrace various economic systems to deal with the fundamental problem of __________.

• Profits
• Inflation
• scarcity
• economics

The way the 19th-century Inuit divided the “spoils of the hunt” demonstrates a __________ economy

• Traditional
• Command
• Market
• Mixed

 In a __________ economy, production questions are answered by the government.

• Traditional
• Command
• Market
• Socialist

In a __________ economy, questions of what, how, and for whom to produce are answered by the buying and selling activity of individuals. 

• Traditional
• Command
• Market
• Socialist

 __________ is a system in which government owns and controls some, but not all, productive resources.

• Traditional
• Command
• Market
• Socialism

 Which statement describes a disadvantage of a command economy? 

• Items tend to be produced solely for the sake of profit.
• It cannot “change direction” easily if the need arises to do so.
•  It does little to help the less advantaged obtain the goods and services they need. 
• Nothing stops the government from producing things that people don’t need or want

How is the principle of “There’s No Such Thing As A Free Lunch” illustrated in a socialist economy?

•  Socialist economies tend to collapse when they become too large.
• The marketplaces in a socialist economy are free for anyone to enter.
• Socialist policies offer advantages to the wealthy at the expense of those less well-off.
• Socialist economies tend to offer extensive government services but have high tax rates.

Which of the following is a disadvantage of a market economy? A.  B.  C. D. 

• It sustains a high degree of uncertainty.
• It restricts personal freedom.
• It discourages creativity and new ideas for doing things. 
• It does not allocate resources as efficiently as other types of economies

Which of the following states an advantage of a traditional economy? 

• Property rights are based on tradition.
• Creativity and original thought are rewarded.
• Everyone knows exactly what their function is
• There’s no bureaucracy to interfere with organizing the economy

What kind of economy offers uniformity in wages regardless of individual productivity? A. all economies C. command and socialist economies B. traditional economies D. market and free-enterprise economies

• All Economies
• Command and socialist economies
• Traditional Economies
• Market and Free-Enterprise Economies