Economics Review Quiz

How is the United States economy primarily characterized?

• Command economy

• Traditional economy

• Mixed economy

• Barter economy

What is the extent of government involvement in the U.S. economy?

• High involvement with strict regulations

• Limited involvement with most decisions made by the private sector

• Government makes all the decisions regarding production

• No involvement at all

What is the basis for determining prices in a free enterprise system?

• Government regulations

• Supply and demand

• Fixed pricing models

• International standards

What rights do individuals/businesses have in terms of private property in the U.S. economy?

• No rights to own property

• Rights to own intellectual property only

• Rights to own real/personal property without undue interference from the government

• Rights to lease property from the government only

What is the profit motive?

• The government's goal to maximize tax revenue

• The consumer's desire to find the best deals

• The individual's opportunity to create a business and earn profits after expenses

• The competition's drive to monopolize the market

What is the result of competition in a free market economy?

• Decrease in the quality of goods and services

• Increase in prices

• Monopolization of industries

• Better quality goods and services at lower prices

Who determines what goods and services will be produced in a system with consumer sovereignty?

• The government

• Producers

• Consumers

• International markets

What is a proprietorship?

• A business with no owner

• A business with one owner who shares the risks and profits

• A business with one owner who takes all the risks and all the profits

• A business with multiple owners and shared liability

What defines a partnership in business organizations?

• A business with one owner

• A business with two or more owners who share the risks and the profits

• A business with two or more owners with no shared risks

• A business with unlimited liability for all owners

What is a corporation?

• A business with unlimited liability for all owners

• A business with one owner and unlimited liability

• A business organization that is authorized by law to act as a legal entity with owners' liability limited to the amount of their investment

• A non-profit organization