SWA Economics Study Guide

What connection can be made about the relationship between national wealth and literacy?

• Literacy is always lower in wealthy countries.

• Countries with oil always have high literacy rates

• There is no relationship

• Literacy is always higher in wealthy countries

In a traditional economy, how are economic decisions made?

• custom and habit

• the government decides

• consumers and the market

• combination of consumers and government

In a command economy, how are economic decisions made?

• custom and habit

• the government

• consumers and the market

• combination of consumers and government

Which would be a problem in a command economy?

• individuals trying to start a new business

• workers forced to do jobs they like

• local crafts produced first

• making products based on habit and tradition

Who takes on the financial risk in starting a new business in a market economy?

• consumers

• government

• individual business people

• combination of government and business owners

Why are all modern economies referred to as mixed?

• government officials do not know how to handle economic problems

• products made by traditional economies are not wanted

• poverty is always highest in market economies

• each country in the world has aspects of both command and market

why do most economies in the world today operate somewhere between a market and command economy?

• most consumers want government control of the economy

• government control makes a market economy more profitable

• government control of some aspects has never been succussful

• most economies have found they need a mix of free market and some government control to be successful

what is economic specialization?

• producing all goods and services needed for a country's growth

• trying to avoid investing in oil

• directly swapping goods

• producing those goods a country can make most efficiently to sell for profit

Saudi Arabia specializes in the production of ___________.

• water

• oil

• sugar

• textiles

what is tariff?

• tax paid when goods are shipped between states

• tax on imports

• tax on local goods

• sales tax paid by consumer