Business Essentials - 2.04 & 2.05 Review

Every society must develop a system for deciding how it will use its resources so that it can

• minimize risk

• prevent problems

• meet people's needs

• control production

Who answers the basic economic questions in a private enterprise economic system?

• government agencies

• businesses and individuals

• influential citizens

• entrepreneurs and producers

One of the results of freedom in the marketplace is that

• businesses use resources efficiently

• people and businesses can own things of value

• people can buy anything they can afford that can legally be sold

• government decides how to use an individual’s private property

Alex owns a guitar, several books, and a telescope. Alex’s possessions are examples of

• private property

• capital goods

• economic resources

• equal distribution

Which of the following is a benefit of the freedom to own private property:

• It helps limit our economic choices.

• It encourages businesses to be cooperative.

• It encourages people to save and invest.

• It allows people to do anything they want to do.

Which of the following statements best describes the way that the U.S. economic system

functions:

• Individuals are the primary decision makers, while businesses are the regulators.

• Individuals and businesses are the primary decision makers, and there is no regulator.

• The government is the primary decision maker, and occasionally it becomes the

  regulator.

• Individuals and businesses are the primary decision makers, while the government is the regulator.

The basic role of the United States government is to

• protect U.S. citizens

• increase production

• maintain control of prices

• limit business startups

In a private enterprise economic system, consumers can choose from a variety of products as a result of

• the collection of taxes

• inflation

• limited government control

• competition

The economic basis for the private enterprise economic system is

• competition

• the marketplace

• the profit motive

• supply and demand

The private enterprise economic system is often described as a(n)

• pure system

• entrepreneur system

• controlled system

• price-directed system