Unit 5 LP 3. Review DR.P

In Country X, the factors of production are all publicly owned and controlled by the government. The basic economic questions of what to produce, how to do so, and how to distribute goods are determined by Country X's government and not by market forces. Because they are set by central planners, prices do not signal to producers whether to increase or decrease production.

What kind of economy is this?

• The government's role in setting the prices of goods shows that Country X has a market economy.

• The government's ownership of the factors of production shows that Country X has a market economy.

• The government's control of the factors of production shows that Country X has a command econom

• The government's encouragement of entrepreneurship shows that Country X has a command economy.

If you were apart of a TRADITIONAL economy how would you answer the three basic economic questions ?

• The past will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. The past will guide all decisions.

• The government will decide what goods to produce, how to produce them, and for which consumers to produce them. The government will make all decisions.

• Supply and demand will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. Supply and demand will guide all decisions.

• Supply and demand will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. The government will intervene to ensure fairness and productivity.

If you were apart of a COMMAND economy how would you answer the three basic economic questions?

• The government will decide what goods to produce, how to produce them, and for which consumers to produce them. The government will make all decisions.

• The past will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. The past will guide all decisions.

• Supply and demand will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. All economic decisions with be guided by supply and demand.

• Supply and demand will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. The government will intervene to ensure fairness and productivity.

How would a MARKET economy answer the three basic economic questions ?

• Supply and demand will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. Supply and demand will guide all decisions.

• The past will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. The past will guide all decisions.

• Supply and demand will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. The government will intervene to ensure fairness and productivity.

• The government will decide what goods to produce, how to produce them, and for which consumers to produce them. The government will make all decisions.

How would a mixed economy answer the three basic economic questions?

• Supply and demand will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. All economic decisions will be guided by supply and demand.

• Supply and demand will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. The government will intervene to ensure fairness and productivity.

• The government will decide what goods to produce, how to produce them, and for which consumers to produce them. The government will make all decisions.

• The past will guide producers in what goods to produce, how to produce them, and for which consumers to produce them. The past will guide all decisions.

What is the rank for these economies from the most command leaning to the most market leaning?

• Cuba, Brazil, Mexico, Chile

• Brazil, Chile, Cuba, Mexico

• Mexico, Chile, Brazil, Cuba

• Chile, Cuba, Mexico, Brazi

This country’s economy is closest to a command economy.

• Cuba

• Brazil

• Mexico

• Chile

Mexico has this type of economic system.

• traditional economy

• pure market economy

• mixed economy

• pure command economy

Why do countries trade with each other?

• Most countries produce a surplus of goods that would be wasted otherwise.

• Most countries trade with other countries in order to make alliances.

• Most countries trade for foreign currency to promote economic growth.

• Most countries cannot efficiently produce everything their populations need.

Which is true about trade barriers?

• Tariffs are imposed to encourage consumers to purchase domestic goods

• Quotas are imposed to encourage producers to improve the quality of goods

• Tariffs and embargoes are imposed to encourage consumers to purchase more goods.

• Quotas and embargoes are imposed to encourage international trade.