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Completes the statement.




 

____ 1. Individuals and businesses have the greatest say about what is produced in

a. market economies.

b. traditional economies.

c. command economies.

d. all economic systems.

____ 2. In this country goods and services are produced in much the same way as long

as anyone can remember. Occupations are determined at birth. The country

has

a. market economy.

b. traditional economy.

c. command economy.

d. mixed economy.

 

____ 3. In another country, privately owned business firms can produce goods or service

in any lawful manner that they choose. This country has a

a. market economy.

b. traditional economy.

c. command economy.

d. mixed economy.

 

____ 4. In a free enterprise system

a. individuals may enter any lawful business.

b. each citizen has the right to vote in elections.

c. goods are so plentiful that they are free.

d. workers do not charge for their labor.

 

____ 5. An economy is “mixed” when

a. goods and services are produced by both publicly and privately owned businesses.

b. government owns or controls all businesses.

c. economic decisions are made by tradition.

d. there is a “mixture” of rich and poor people.

 

____ 6. Which of the following decisions did not involve an economic incentive?

a. Alex saved his extra money in an account earning 6.5% interest.

b. Beta General Corp. purchased new robots to increase production.

c. Carlos feels it is important to stay healthy, so he spent the weekend hiking in the mountains.

d. Dolores returned to school to learn computer programming.

 

____ 7. Which of the following is a reason for government participation in the economy.

a. to reduce competition in the marketplace.

b. to provide goods and services more cheaply than private enterprise.

c. to regulate harmful externalities.

d. to guarantee that all business firms earn the profit.

 

____ 8. Which of the following is an example of a public good or service?

a. traffic lights.

b. World Series baseball games.

c. fuel-efficient compact automobiles.

d. computer repair service calls.

 

____ 9. Which economic system is based on a market economy?

a. capitalism.

b. communism.

c. socialism.

d. traditionalism.

 

____ 10. We generally refer to a nation that has a democratic political system, together

with government ownership of major industries, as

a. capitalist.

b. communist.

c. socialist.

d. fascist

 

____ 11. Which term does not belong with the other three?

a. Gosplan.

b. price-directed economy.

c. central economic planning.

d. five-year plan.

 

____ 12. The policy known as glasnost introduced by the Soviet leader Mikhail

Gorbachev

a. represents a return to Stalinist repression.

b. has made the Soviet Union a true democracy.

c. encourages some public criticism of government.

d. prohibits public discussion of weaknesses in the Soviet system.

 

____ 13. Perestroika which is Russian for “restructuring”,

a. has been denounced by the United States.

b. represents a return to the economic principles of Karl Marks.

c. provides for an increased involvement of government in day-to-day operations of economic enterprises.

d. allows prices to be set by market forces and requires Soviet enterprises to pay

their own way.

 


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