Economic Systems & Macroeconomics Quiz

What are the three basic economic questions every system must answer?

• What to produce, how to produce it, who gets it

• What to buy, how to sell it, where to sell it

• Who works, who buys, who profits

• What to make, when to make it, who delivers it

In a planned economy, who controls the factors of production?

• Consumers

• Private businesses

• The government

• The stock market

What is a "command economy"?

• An economy run by military leaders

• An economy with no rules

• A new type of cryptocurrency system

• An economy fully controlled by the government

What does “laissez-faire” mean in economics?

• Free lunch for all workers

• Hands-off government approach

• The market is closed

• Government does all the planning

What is the "invisible hand" in free market economies?

• The idea that self-interest leads to societal benefit

• A kind of secret economic strategy

• A tax loophole

• The way governments guide business

Why might inefficient businesses fail in a free market?

• The government shuts them down

• Consumers don’t buy their products

• They don’t pay enough taxes

• There is no competition

What are public goods and services examples of?

• What people buy with coupons

• What the private market creates

• What the government provides

• What is banned in a market economy

What does the circular flow model show?

• How money and resources move between households, businesses, and government

• How inflation works

• Only how businesses sell products

• Only international trade

What type of economy do most countries have today?

• 100% free market

• Mixed economy

• 100% command

• Barter economy

What did Thomas Sowell say about economic decision-making?

• Every decision is a solution

• Government should always pay

• There are only trade-offs

• It’s all about emotions