Economic Systems Study Guide

Every country has to answer 3 basic economic questions: List the three basic economic questions every country must answer.

• What to produce? How to produce? Whom to produce?

• What to import? How to export? Whom to tax?

• What to consume? How to save? Whom to employ?

• What to buy? How to sell? Whom to hire?

In a traditional economy roles are _______ from parents and _______ is common.

• chosen; gifting
• inherited; bartering
• assigned; selling
• earned; trading

In a command economy roles and jobs are determined by the _______. In this economy the _______ owns all industries and resources and dictates _______ and production quotas.

• government, government, wages

• market, government, prices

• individual, private sector, profits

• consumers, corporations, demand

In a market economy _______ dictate what goods and services to sell. Entrepreneurs are abundant in a market economy and _______ and demand determines prices.

• citizens, supply

• governments, production

• banks, inflation

• politicians, taxes

Mexico’s economy is _______ free and _______ government.

• 65%, 35%

• 50%, 50%

• 80%, 20%

• 40%, 60%

Brazil’s economy is _______ free and _______ government.

• 53%, 47%

• 60%, 40%

• 70%, 30%

• 45%, 55%

Cuba’s economy is _______ government and _______ free.

• 67%, 33%

• 50%, 50%

• 80%, 20%

• 40%, 60%

In the figure above, Cuba would most likely be represented by the letter: ?

• A

• B

• C

In the figure above, Brazil would most likely be represented by the letter: ?

• A

• B

• C

In the figure above, Mexico would most likely be represented by the letter: ?

• A

• B

• C