REVIEW: UNIT 2 ECONOMIC SYSTEMS

Pop Quiz! Which of these is NOT a dilemma that keeps economists up at night?

• what to produce

• how to produce

• for whom to produce

• why to produce

What's the invisible hand guiding how we all make stuff and get stuff? It's the system born from everyone's choices, shaping how a society gets its groove on with producing and munching on goods and services. What's it called?

• government

• nation-state

• business

• economy

The Joker once quipped, "If you're good at something, never do it for ___________." What's the missing word?

• free

• at-cost

• money

• long

Let's dive into the world of economics! Here's a thought: At the heart of economic theory is the idea that

• B) our resources are like a magical well that never runs dry

• C) who cares about incentives, right?

• D) consumers just flip a coin to make decisions

• A) our wants and desires just keep going on and on

Dive into the world of economics with Adam Smith! What does his famous "invisible hand" concept really mean?

• A) government should focus on trade policies

• B) consumers cannot make rational choices involving the long run

• D) only businesses should be involved in providing fairness of the market

• C) entire economies will benefit if individuals pursue their self interests

Imagine you're in a world where all economic decisions are guided by ancient customs. What type of economy is this?

• Traditional

• Command

• Market

• Mixed

Guess which economy thrives when the government rolls out incentives for folks to brainstorm and launch their own ventures?

• Traditional

• Command

• Mixed

• Market

In which economic system do central planners, such as the government, make all the big decisions?

• Traditional

• Command

• Market

• Mixed

In which economic system do buyers and sellers get to make their own decisions?

• Traditional

• Command

• Market

• Mixed

Ready to test your knowledge? What's one of the main goals of a market economy?

• Security

• Efficiency

• Equity

• Stability