Centrally Planned Economies Quiz

Who makes most basic decisions in a centrally planned economy?

• investors
• consumers
• government
• market forces

What did Karl Marx believe about capitalism?

• that it was the source of all value
• that it led to exploitation of workers
• that it distributed wealth fairly in society
• that it was the inevitable product of socialism

Which policy change was partly responsible for economic growth in China starting in the 1970s?

• imposing more controls on Chinese farmers
• forcing factory workers to work on farms
• promoting new agricultural products
• giving farmers the chance to own land

What is one reason centrally planned economies tend not to be efficient?

• Workers lack the incentive to work harder.
• Decision-makers do not have enough power.
• Decision making is too decentralized to be effective.
• Factories produce too many types of goods.

How did communist China manage to survive when the Soviet Union did not?

• China abandoned central planning.
• China was more effective at central planning.
• China did not engage in a military buildup.
• China introduced capitalist reforms.

Which of the following is typical of a centrally planned economy?

• competition among producers
• consumer sovereignty
• government control
• private property

Which of the following represents a difference between socialism and communism?

• Socialism requires central control of all productive resources; communism does not.
• Socialism may allow some free market practices; communism does not.
• Socialism emphasizes the equal distribution of wealth; communism does not.
• Socialism depends on authoritarian government; communism does not.

What distinguishes an authoritarian government from a democratic one?

• It respects individual rights.
• It pursues capitalist economic policies.
• It discourages a strong central government.
• It requires strict obedience from its citizens.

How were the Soviet Union and communist China similar?

• Both suffered from severe economic problems as a result of central planning.
• Both eventually became free market economies.
• Both were more successful in developing a thriving agriculture than in developing thriving industry.
• Both states turned away from communism and were able to avoid collapse.

What is a disadvantage of central planning?

• no emphasis on economic equity
• lack of economic efficiency
• too much individual freedom
• overreliance on profit incentive