Government and Economic Systems Quiz

What is an essential part of a legitimate and functioning government?

• The authority to enforce laws

• The divine right to rule

• A social contract

• The support of its people

The Federal Deposit Insurance Corporation is an agency created by the U.S. Congress to monitor and assist financial private institutions to protect consumers. This agency fulfills which function of government?

• Provide economic assistance

• Provide economic security

• Provide leadership

• Provide national security

Which of these examples highlights a disadvantage of the federal system of government?

• Different levels of government can handle different types of problems.

• Federal and state agencies can collaborate to combat homelessness

• Looser federal environmental laws are enforced over stricter state laws.

• States can obtain funds from the federal government for road projects.

In a true free market economy, which of the following would occur?

• Access to natural resources would be uncontrolled

• Safety regulations would offer consumer protections

• Successful producers would be given tax breaks

• Workers would obtain fair wages by law

How do the goals of socialism differ from the goals of capitalism?

• Only capitalism stresses private ownership of business

• Only capitalism strives to award workers a fair wage

• Only socialism has the goal of serving society

• Only socialism works to prevent government interference

Which of these characterizes one predicted result of a laissez-faire system?

• Better workplace conditions for workers

• More government involvement in business

• Producer competition for resources

• Unlimited supply of consumer products

Which of these is an example of a government maintaining order?

• A community constructs a municipal water treatment plant

• Firefighters hold infant car seat clinics in fire stations

• Officers screen visitors for weapons at the entrance of a courthouse

• The Marines hold drives to collect toys during the holidays.

A producer in a capitalist system might do which of the following to further her goals?

• Ignore costs of production

• Raise prices in the face of competition from another company

• Redesign products to use fewer resources

• Sell a share of her business to a government entity

Which of these is true of current communist countries?

• Distribution is controlled by the workers

• Government controls natural resource use

• No one receives wages for work

• Private investments are common.

In which type of economic system does the government play the smallest role?

• Capitalism

• Communism

• Mixed economy

• Socialism