Chapter 2 - Economic Systems

In which of these systems is the government most likely to provide people with goods and services they could not otherwise afford?

• market economy

• socialist economy

• traditional economy

• free-enterprise economy

Which of the following is a feature of a command economy that distinguishes it from a socialist economy?

• Some degree of private ownership and activity is allowed

• All economic decisions are based on custom and habit

• All economic decisions are made by the free market

• All production is managed by the government

Which of the following lists economic systems in order from least to most flexible?

• command, socialism, free market

• free market, command, socialism

• socialism, command, free market

• free market, socialism, command

Which type of economy is most prevalent in the world today?

• command

• traditional

• market

• mixed

Which of the following is a feature of Japanese capitalism that would be illegal in the United States?

• keiretsu

• privatization of business sectors

• collectivization of industry and agriculture

• perestroika

Which statement describes a disadvantage of a command economy?

• Nothing stops the government from producing things that people don't need or want

• Items tend to be produced solely for the sake of profit

• It does little to help the less advantaged obtain the goods and services they need

• Efficient production and quality goods are commonly found in command economies

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 statements best describes the communist ideal?

• a classless society in which workers are motivated by financial incentives

• a society in which the working class is motivated by incentives to produce goods

• a classless society in which everyone works for the common good

• a society in which a small ruling class administers resources for the common good

Which of these is an accurate statement about mixed economies today?

• Most nations that once had a mixed economy have evolved into command economies

• Mixed economies exist mostly in nations with communist governments

• Very few economies today can be accurately described as "mixed"

• There are more mixed economies in the world than any other kind

Which country is an example of a capitalist country?

• Cuba

• North Korea

• Soviet Union

• Japan