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WorksheetsEconomic systems
Total questions: 18
Worksheet time: 18mins
Which pair of economic institutions can be found in a market economy?
local government and charities
monopolies and commercial banks
nationalised industries and partnerships
stock exchange and public corporations
In a city, what is most unlikely to be provided by the private market system?
a museum
a school
sports field
street lights
Which type of business organisation is necessarily in the public sector of the economy?
multinational company
public limited company
public corporation
sole trader
Which situation indicates a mixed economy?
Economic activity is controlled entirely by the private sector
Individual choices are unaffected by government actions
Services are provided by both private and public sectors.
The government carries out all planning and decision making
Unlike the UK and US, a significant proportion of the shares on the stock exchanges of China and Russia are of state-owned enterprises.
Which judgement about China and Russia can be made from this information?
their distribution of income and wealth
their level of development
their stages of production
their type of economic system
Cuba is implementing free market reforms. What is a likely advantage of this?
a wider variety of goods and services produced
greater equality between the different groups in society
increased provision of public goods
less consumption of goods with external costs
What is a characteristic of tertiary industries?
They are located away from centres of population
They do not sell to the final consumer
They tend to be labour-intensive
They transform raw materials into goods.
What can be found in a market economy?
externalities and monopolies
interest rates and public goods
public corporations and market prices
tax rates and commercial banks
An economy operates entirely as a market system. Which type of service would not be provided in such an economy?
commercial banking services
free government health services
Private educational services
profitable retail services
China, the world’s second largest economy, is becoming more like a market economy. Which policy would contribute directly to such a change?
abolishing state control completely
encouraging consumers to spend more and save less
reducing exports and encouraging more imports
transferring wealth from the state sector to the private sector
What is the government most likely to produce in a mixed economy?
all of the services and none of the goods
amounts of goods and services equal to those of the private sector
no goods and services
some of the goods and services
Who determines what goods and services are produced in a market economy?
consumers
employees
government
trade unions
What is a function of a country’s stock exchange?
to act as lender of last resort to commercial banks
to provide a market for the purchase and sale of shares
to provide short-term loans for investment
to set interest rates within the country
Which activity takes place in the tertiary sector?
assembling computers
giving legal advice
harvesting grain
making bread
What is a major advantage of a market economic system over a mixed economic system?
All production of goods and services is determined by consumer demand.
Ownership of resources is divided between private and public sectors.
Producers include any external costs they create in the price of the good.
There will always be an even distribution of income and wealth.
In a market system who has the most important role in influencing the allocation of resources?
consumers
entrepreneurs
government officials
producers
What is a benefit of the free market system?
Innovation is encouraged to increase profits.
Negative externalities can be controlled.
Subsidies can be used to encourage exports.
The distribution of goods and services is fair.
What is a benefit of the market system?
Competition ensures choice for consumers.
Prices equal supply costs.
Unemployment is kept to a minimum
Wage differentials are small.
