Econ Market Systems

Capitalism is a competitive economic system in which private citizens own the factors of production.

• true

• false

Voluntary exchange is a characteristic of command economies.

• True

• False

The profit motive states that the consumer decides WHAT goods and services to produce.

• False

• True

The entrepreneur organizes land, capital, and labor for production in hopes of earning a profit.

• False

• True

The United States has a modified private enterprise economy.

• True

• False

The purpose of government in a command economy is to

• encourage entrepreneurs.

  
  

• ensure the availability of consumer products.

  
  

• make major economic decisions.

  
  

• promote economic freedom.

  
  

An example of a market economy is

• North Korea

• United States

• Former Soviet Union

• Inuit

Which group of people ultimately determines the products that a free enterprise economy produces?

• Consumer

• Congress

• property owners

• local government

The United States can best be described as having a

• traditional system.

  
  

• command economy.

  
  

• modified private enterprise system.

  
  

• pure free enterprise system.

  
  

A market economy

• limits the choices of goods and services available.

  
  

• does not provide for everyone's basic needs.

  
  

• permits extensive government intervention.

  
  

• offers a high degree of certainty for its workers.