Econ Quiz 2.1-2.3

In a centrally planned economy, the three key economic questions are answered by the

• central government alone.

• central government with input from industry.

• marketplace alone.

• marketplace with some government involvement.

A mixed economy is

• a market-based, economic system based on free enterprise with some government involvement.

• an economic system in which the government regulates all prices, production, and products.

• exactly the same as a centrally planned economy.

• the exact opposite of a free enterprise system.

Which of the following is NOT a key economic question that every society must answer.

• Who gets to consume which goods and services?

• How should goods and services be produced?

• What goods and services should be produced?

• Where should goods and services be produced?

The income people receive for supplying factors of production, such as land, labor, or capital, are

• monetary inputs.

• capital investments.

• factor payments.

• receivables.

A centrally planned economy is

• always the most efficient economic system.

• an economic system in which the government makes all the decisions about production and consumption of goods and services.

• a form of free enterprise with minimal government involvement.

• an economic system that has no government involvement.

The method used by a society to produce and distribute goods and services is

• a production curve.

• an economic system.

• an opportunity cost.

• the standard of living.

The struggle among producers for consumer dollars is

• incentive.

• self-interest.

• competition.

• laissez faire.

Which of the following is an example of competition in the marketplace?

• A small town has only two grocery stores, which are located one block away from each other.

• Two neighbors buy the same model of automobile.

• Two farms are separated by a stream that provides water for the cattle raised on each farm.

• Two high schools have excellent football teams.

In the study of economics, the definition of a market is

• the concentration of the productive efforts of individuals and firms on a limited number of activities.

• an arrangement that allows buyers and sellers to exchange things.

• a place to buy groceries and other household items.

• a place where producers display their wares for sale.

Why do markets exist?

• because people are not self-sufficient and need goods and services produced by others

• because people are naturally competitive

• because everyone enjoys trade and business

• because most people are entrepreneurial