MCAP Review 15: Types of Economies

In this type of economy, individuals and groups can own businesses, but must follow strict government regulations.

• traditional economy

• command economy

• market economy

• mixed economy

Answer explanation

It's mixed because there's a mix of private ownership of business and government involvement.

The government provides small business loans to promote entrepreneurship.

• traditional economy

• command economy

• market economy

• mixed economy

Answer explanation

It's mixed because there's a mix of private ownership of business and government involvement.

The laws of supply and demand are typically ignored.

• traditional economy

• command economy

• market economy

• mixed economy

Answer explanation

It's mixed because there's a mix of private ownership of business and government involvement.

The government controls resources, land, and factories.

• traditional economy

• command economy

• market economy

• mixed economy

Answer explanation

It's mixed because there's a mix of private ownership of business and government involvement.

The basic economic questions in the United States are mainly answered by

• individuals and businesses

• the United States Congress

• state and local governments

• the President of the United States

A traditional economy is an economic system

• based on long-standing customs

• composed of elements of market and command economies

• controlled completely by the government

• determined only by individuals competing for profits

Which statement explains why this cartoon illustrates a mixed economy?

• The employee sells a variety of products to the customers.

• The employee can use his wages to pay for living expenses.

• The government tells a private business how much to pay its employees.

• The business sets the prices that customers pay for the food.

Answer explanation

It's a mixed economy because it's a mix of privately owned business and government regulation.

Which of these is a characteristic of a market economy?

• limited business rights

• competition between businesses

• government control and ownership of property

• nationwide pricing rules for goods and services