Decision about what to produce in a command economy are made by

national leaders and government officials

A description of capital resources, that economists refer to are:

Factories,equipment, and machinery.

Consumers, by definition, are most likely to use their money to

satisfy specific needs and wants

Sweden provides many public services without charge. Which statements is true?

Citizens pay higher tax rates to pay for public services.

Between two people in a voluntary exchange

Both expect to benefit from the exchange.

The study of Economics is best defined as:

people using their resources to satisfy competing wants.

The "invisible hand", Adam Smith's theory, best describes what situation?

People seeking their own self-interest makes them better off

Economist, Adam Smith, would agree with which of the following statements?

Free markets have the ability to regulate themselves

The four factors of production are?

land,labor,capital and entrepreneurship.

Goods are most often produced as a result of what in a market economy?

interaction between buyers and sellers

The United States economy is best described today as

mixed economy with government regulations

The reason for scarcity is best explained by which statement?

People's wants exceed the resources available.

Compared to free market economies, command and traditional economy systems generally have

fewer privately owned businesses

Market economies usually result in what compared to command economic systems?

more competition among producers

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Marks Econ. Chapter 1 and 2 Review

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Questions 40

Answers

1
You go into a business for what purpose?
profit (Money)
government mandate
have extra money to invest
partnership opportunity
2
Market economy pillars are:
private property
all of the above
market competition
price system
3
Country Y, gov't regulates business, people own factors of production. What system is it?
command economy
B and C
mixed economy
free market economy
4
Decision about what to produce in a command economy are made by
buyers and sellers in a process of voluntary exchange
entrepreneurs and business investors
elected community leaders
national leaders and government officials
5
A description of capital resources, that economists refer to are:
Factories,equipment, and machinery.
Money in the bank.
Soil, mineral deposits and other raw materials.
Workers and materials.
6
Consumers, by definition, are most likely to use their money to
research and develop new products
market new services to the public
purchase raw materials for manufacture
satisfy specific needs and wants
7
Which economic system answers ONLY by the interaction of buyers and sellers?
Everything is free economy
Free enterprise system
Command system
Traditional economy
8
Sweden provides many public services without charge. Which statements is true?
Few participate in government public service programs
Citizens pay higher tax rates to pay for public services.
Citizens enjoy public services without paying taxes
Most pay for public services.
9
Ann wants to play ball and work,She decides to play ball. The opportunity cost is?
Playing softball
Being with friends
There is no opportunity cost, because no money is spent.
Working
10
The decision to produce, how and for whom to be produced, is decided by who?
both A and B
B. businesses
none of the above
A. consumers
11
What is a major problem facing all economic systems?
Technology
surplus production
Scarcity
inadequate wants
12
From 1776 to around 1900, which BEST describes the economic system in the U.S.?
pure capitalism
command
socialism
Mixed economy
13
What do you surrender when you move on the spectrum from command system to capitalism
Freedom
Resources
Equality of opportunity
Equality of outcome
14
Thomas Jefferson stated"Free men are not ____. Equal men are not ____."
equal, free
Controlled, free
Equal, controlled
Dictated, elected
15
Which person is most associated in the command system of economics?
Milton Friedman
John Stuart Mill
Karl Marx
Adam Smith
16
What resources are examples of Iron ore, timber, and crude oil?
natural resources
All of the above
human resources
capital resources
17
Between two people in a voluntary exchange
Both lose more than they gain.
Both expect to benefit from the exchange.
No one gains or loses.
One gains the other loses.
18
The study of Economics is best defined as:
people using their resources to satisfy competing wants.
types of business organizations.
the production of goods and recources in a given market.
how the government allocates scarce resource.
19
An incentive is which of the following?
B. Buy one/get one without cost
A. consistent practice leads to a win for the team
both A and B
C. Increased income leads to increase taxes paid
20
Capitalism wants an equality of opportunity
And economic equity.
And shared resources.
Not an equality of outcome,
And an equality of outcome.
21
Illustrations of a market are which of the following?
Phone orders for an electronic gadget.
All of the above.
Owner of a used car business buying car parts.
A person buying spark plugs at an auto parts store.
22
Have $900 for books, stereo and a printer. Chose books and printer. Opportunity cost is?
stereo
$1150
Stereo and books
$900
23
The "invisible hand", Adam Smith's theory, best describes what situation?
free markets result in personal hardship and financial ruin
People seeking their own self-interest makes them better off
Govt subsidies require to improve Econ conditions.
political leaders collect taxes to ensure prosperity.
24
In a market economy, when you purchase a product, you are engaging in:
government regulation
predatory pricing
voluntary exchange
monopolistic competition
25
Economist, Adam Smith, would agree with which of the following statements?
Prices needed to be adjusted so things are fair
Politicians are better making decisions than consumers
Free markets have the ability to regulate themselves
Governments need to control the economy
26
The four factors of production are?
profits,prices,markets and entrepreneurship.
land,labor,capital and entrepreneurship.
land, financial capital,entrepreneurship, labor.
land,labor,profit and prices.
27
When making a choice,what is the highest valued alternative GIVEN UP?
Profit/loss statement
opportunity cost
scarcity cost
Mutual benefit
28
Capitalism, decisions about production and distributing of goods and services are made by:
producers and consumers
politicians in the federal government
military personal
economist hired by the government
29
Country X, government owns the land and prices are set by government. What system?
Command economy
A and B
Mixed economy
Free market economy
30
An economic system works hand in hand with a country's:
Political system
Educational system
Environmental system
All of the above
31
What do you surrender on the spectrum when moving from free market to the command system?
Machinery
Freedom
Equality
Resources
32
Goods are most often produced as a result of what in a market economy?
interaction between buyers and sellers
decisions made by a central authority
equal sharing based on individual needs
laws adopted by a majority rule of citizens
33
The United States economy is best described today as
mixed economy with government regulations
pure market without government regulation
command economy
traditional economy
34
A person who starts a business and produces a product is an
Enterpreneur
Partner
Manager
Broker
35
The reason for scarcity is best explained by which statement?
Population is growing faster than production.
People's wants exceed the resources available.
Getting products from producers to consumers.
None of the above.
36
Compared to free market economies, command and traditional economy systems generally have
fewer government regulations and rules to follow
higher standard of living among the general population
fewer privately owned businesses
a wider variety of choices for consumers
37
Market economies usually result in what compared to command economic systems?
fewer entrepreneurial opportunities
more competition among producers
fewer choices available to consumers
more government regulations of business
38
Grill,freezer,hamburger,cash register,fryers.Which is NOT capital?
grill
Grill/fryers
cash register
hamburger
39
"The Wealth of Nations" was written by whom?
John Maynard Keynes
Benjamin Franklin
Karl Marx
Adam Smith
40
Small community,family and agriculture is based on what economy?
Command economy
Mixed economy
Small economy
Traditional economy

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