CH. 2 test review

If Mel buys a new car and nobody tells him

what he has to buy, he is engaging in

• Command economy

• Profit motive

• competition

• Voluntary exchange

Habit and custom dictate most social behavior in a

• Market economy

• traditional economy

• command economy

• free enterprise economy

The United states has an ______________________

• Market economy

• traditional economy

• command economy

• communist

Which of the following allows private citizens to own the factors of production?

• Market economy

• traditional economy

• command economy

• communist

U. S. citizens carrying on their economic affairs

freely, but subject to some government

intervention and regulations, refers to which of

the following?

• Free enterprise

• traditional economy

• command economy

• communist

In a command economy, which of the following is a disadvantage (weakness)? CLICK ALL THAT APPLY

• Not designed to meet wants of consumers

• Lots of incentives to work harder

• Requires large decision making bureaucracy

• No individual freedom

This is an organized way of providing for the

wants and needs of a society.

• Voluntary exchange

• economy

• traditional economy

• market economy

Who is responsible for making basic economic

decisions in a command economy?

• Citizens

• Buyers

• Sellers

• A central authority

This is a federal program of disability and retirement benefits that covers most working people.

• Medicare

• Medicaid

• Social security

• None

In a market economy, the following are advantages. CLICK ALL THAT APPLY

• it can adjust to change over time

• relatively small degree of government interference

• high degree of individual freedom

• decision making is not in the hands of a few